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ISLAMABAD (December 16 2005): A leading Jordanian investors group led by Dr Jawad A. Anani of Shaheen Business and Investment Group, currently visiting Pakistan, on Thursday expressed interest to invest $1.5 billion in power, petroleum and natural resources, cement, tourism, housing and Gwadar Industrial Estate projects in Pakistan.

Dr Jawad Anani expressed these views in a meeting with privatisation minister Dr Abdul Hafeez Shaikh here on Thursday.

The minister said there was a vast scope for the group to participate in the privatisation programme, which offered the management control of Faisalabad Electric Power Company (Fesco), Jamshoro Power Generation, Pakistan Steel Mills Corporation and Sui Northern and Sui Southern gas transmission and distribution companies.

Dr Jawad Anani informed the minister his group intended to invest $1.3 billion for establishing 1200mw power plant on Built-Operate-Own (BOO) basis with the PPIB; to lay down 470km white oil pipeline extension from Gwadar-Lahore-Rawalpindi-Peshawar; to avail opportunities in industry and tourism sectors; industrial estate in Gwadar and housing projects in Islamabad.

The group also showed interest in the privatisation process, particularly the power generation and gas transmission and distribution sectors.

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Administrator @ Defence.pk

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ISLAMABAD (December 16 2005): The Asian Development Bank (ADB) has approved $1.333 billion for four projects in different sectors including $300 million for reconstruction of earthquake-hit areas of NWFP and AJK.

Of the total $1.333 billion, an amount of $773 million would be spent on the improvement of National Highway Network in Pakistan. Besides, $60 million will go for improvement of environmental conditions in Rawalpindi district.

The bank approved $200 million for improvement of fiscal and financial governance and public service delivery in Punjab. A Pakistani delegation from economic affairs division (EAD) last week visited Manila to discuss these projects.

EARTHQUAKE EMERGENCY ASSISTANCE PROJECT: The bank approved $300 million assistance to rebuild areas worst hit by the October 8 earthquake. This project will help restore infrastructure and livelihoods in NWFP and AJK.

It is worth mentioning the Earthquake Emergency Assistance Project is part of $1 billion assistance that was announced in November by the bank.

It will reconstruct lost assets and restore services in affected areas. It will address transport, power, health and education sectors in AJK and NWFP.

It features a quick disbursing mechanism amounting to $108 million to finance import of materials urgently needed for the recovery process.

The project additionally addresses needs of vulnerable groups, including women and children, and assists affected people by supporting the reissue of lost documentation as well as protecting their legal rights.

"The project aims to quickly reverse the devastating impact of the earthquake and revive economic activity to enable people to resume their livelihoods and return to normal life," an ADB senior transport specialist Fernando Garcia said.

Work planned includes rehabilitation of earthquake-damaged major roads and bridges; repair of hydropower generating stations and construction of new lines and facilities; and reconstruction of health and education facilities in affected districts.

The Earthquake Rehabilitation and Reconstruction Authority will be the executing agency for the project, which is due to be completed within three years.

The finance ministry will manage the multi-donor Consolidated Fund for Emergency Earthquake Assistance established in the State Bank through which the project funds will flow.

IMPROVEMENT OF NATIONAL HIGHWAY NETWORK: Under the project, the bank will promote long-term development of national highway network and improved regional connections.

The Multi-tranche Financing Facility (MFF), a new ADB financing product, will support the government's national highway development plan intended to overcome critical bottlenecks in the country's road network by improving existing networks, creating new ones, and advancing policy reform.

The investment is structured into three hatches of projects: the first comprises three sample projects totalling 376km; in the second batch, five projects totalling 460km; and the third will be determined later.

The MFF assistance has a maximum utilisation period of 10 years during which individual financing requests will be converted into separate loans.

The government and other agencies will meet rest of the cost. Closing date for submission of periodic financing requests is end of 2011.

IMPROVEMENT OF URBAN ENVIRONMENT IN RAWALPINDI: Under this project, two bank loans totalling $60 million will help improve urban environment for about 1.4 million people living in Rawalpindi.

The new project will improve the city's water supply and sanitation facilities. Among others, it will install major sewerage networks, provide a sewage treatment plant, develop a landfill site and construct a solid waste transfer station, build a hygienic slaughterhouse and public toilets, and provide latrines and safe drinking water to all schools in the project area.

"The project will considerably reduce environment degradation and lead to sustainable operation of basic urban services," an ADB senior urban development specialist Shakeel Khan.

ADB has provided eight loans totalling about $450 million to Pakistan's urban sector since 1976. About $7.1 million in grants have been provided for technical assistance projects in water supply, sanitation and urban development.

The project has estimated a total cost of $85.7 million. The ADB will cover 70 percent of the total cost by providing $40 million loan from its concessional Asian Development Fund (ADF) and $20 million from Ordinary Capita] Resources (OCR).

The Punjab government will contribute $21.4 million equivalent to the project and the balance $4.3 million will be shouldered by Rawal town and the Water and Sanitation Agency.

The Rawalpindi district government is 1he executing agency for the project, which is due for completion in March 2011.

RESOURCE MANAGEMENT PROGRAM IN PUNJAB: The bank approved $200 million for this programme to further improve fiscal and financial governance and public service delivery in the province.

The loan is for the second phase of the Punjab Resource Management Programme (PRMP).

The first phase, approved in 2003, improved the short- to medium-term fiscal management of the provincial government, enabling higher spending for the social sector and effective devolution of social service delivery to local governments.

Formulated in co-ordination with various stakeholders, the second phase will help Punjab reform governance structures, systems, and procedures to provide "fiscal space" for sustainable development activities and to ensure effective and transparent use of funds.

It will strengthen institutional arrangements to increase the impact of public expenditure on poor segments of the society and improve service delivery. The programme will also help create a conducive environment for private sector development, growth, and income generation.

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LAHORE (December 16 2005): Pakistan Railways (PR) has decided to set up three new dry ports at Raiwind, Sheikhupura and Azakhel. Working details about these dry ports are yet to be prepared as the Railway administration has just taken decision in this regard.

These dry ports would be developed in collaboration with the private sector and advertisements regarding Raiwind dry port inviting interest from private sector would be given by January 1, 2006.

The Railways Minister, Mian Shamim Haider, stated this while talking to journalists after a meeting held at the PR Headquarters here on Thursday.

The minister said that Khokarapar-Monabao track was expected to be inaugurated till January 31, next by President or Prime Minister. He said that opening of this track would facilitate people of Karachi wanted to visit India through railways.

Earlier they had to travel through Lahore, which takes 17 hours, and with the opening of this route, this would curtail journey time from seven to eight hours.

The minister further informed that Prime Minister, Shaukat Aziz would open the work for doubling of track between Shershah and Shujaabad on December 31, 2005.

He said that work on another project for dualisation of track between Khanewal and Lahore section had already been initiated and hopefully it would be completed in 18 months.

Regarding private sector involvement in running of trains, he said that pre-bidding seminar was attended by 50 parties. He said that some companies had shown interest in freight.

Replying a question about imposition of fuel surcharge, he said that railways had suffered a loss of Rs 1,350 million due to increase in time and again increase in fuel prices in last seven months. He said that major portion of passengers who travel within 50 kilometers would not be effected.

To another question, he said that railway in order to avert accidents in future had reduced the working hours of driver, provided them various facilities besides making new recruitment, provision of walkie talkies so drivers could talk to next station and guard of the train.

About increasing revenue, he said that they were concentrating on freight sector to increase the revenue and wanted to carry maximum freight.

However, he said that delay in import of wagons from China had created some problems. He admitted that corruption exists in Railways, however, he denied that corruption had increased in the department.

Chairman Railways, Shakeel Durrani who was also present on this occasion along with General Manager and other high-ups, said that room still exists for improvement in the food, wash rooms and provision of drinking water.

He said that supply of food would be handed over to PRACS in some trains, which would be providing hot meal on reasonable rates.

To another question, he said that they would also looking in to ways and means to solve the problem of unmanned railway crossings to avoid accidents.

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Pakistan to play vital role in Cairns Group

Pakistan has joined the Cairns Group representing agriculture exporting countries belonging to developed and developing nations in the ministerial meeting of the group on Wednesday, thus becoming 18th Cairns’ member

The group brings together developed and developing countries from Latin America, Africa and Pacific Asia region. It has been an influential voice in the agriculture reform debate since its formation in 1986, and has continued to play a key role in pressing the WTO members to meet in full the far-reaching mandate set in Doha.

Pakistan is an important producer, importer and exporter of agriculture products, and the sector is the main source of national employment, because over 70 per cent of its population depends on agriculture and lives in rural areas. Along with other Cairns members, Pakistan will have a vital role to play, because it has been given the role of facilitator in the non-agriculture market access (NAMA) group.

In a statement on Wednesday, Minister of Commerce, Humayun Akhtar Khan, encouraged Cairns Group ministers, “to work together and pool our resources to fight for the rights of our poor farmers and provide for a trading environment, which is not tilted in favour of the rich.” He said his country was a constructive contributor to the Doha Round and a strong supporter of the multi-lateral rules-based system. It has been a GATT signatory since 1948, and joined the WTO on its establishment in 1995.

Other members of the group are: Argentina, Australia, Bolivia, Brazil, Canada, Chile, Colombia, Costa Rica, Guatemala, Indonesia, Malaysia, New Zealand, Paraguay, Philippines, South Africa, Thailand, and Uruguay.

Meanwhile, the Cairns Group in a declaration said, it is unrealistic to expect all the divergences of this negotiation to be bridged in Hong Kong. However, we can and do aspire to take significant steps forward on the shape of a package in agriculture, in all three pillars, including on special and differential treatment, and on cotton. The group demanded that the major subsidizers must take further meaningful steps in the area of domestic support, if we are to reach a final agriculture package. And, it should be ensured that the progress be made towards agreeing to an early end-date, no later than 2010 for the elimination of all forms of export subsidies, the most distorting of all agriculture measures.

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ISLAMABAD (December 17 2005): The World Bank has approved a $400 million 'Emergency Recovery Credit' (ERC) from its concessional International Development Association (IDA) to further support earthquake recovery and reconstruction effort.

The project will support Pakistan efforts to reduce immediate suffering and restore livelihoods; reconstruct housing; and help finance needed imports.

It will support housing reconstruction ($220 million), livelihood support ($85 million), import financing ($85 million), and capacity building ($10 million).

A press statement issued here said that the Bank also could make funds available for any financing gaps identified in other sectors, such as social protection, health, education, agriculture, roads, water supply, and other infrastructure.

The loan follows the Bank's initial commitment of $475 million in October as part of the Bank's overall pledge of $1 billion for earthquake regions recovery.

"Earthquakes make things fall apart. This credit will allow people to put their lives and home back together, " said John Wall, World Bank Country Director for Pakistan.

"Poor people living in inaccessible mountain areas have borne the brunt of the earthquake's impact. They are now struggling to rebuild their lives after losing not only family members and loved ones, but also their homes, assets, and work. This project will support these people rebuilding their houses and restore their livelihoods through income transfers."

Wall added that the total package of assistance would help rebuild communities along with agriculture, transport and basic services; and support the resumption of livelihoods in the most remote and poorest earthquake-affected districts.

In addition to the enormous human toll, the cost of the earthquake and its aftermath will present Pakistan with an enormous financial challenge.

The reconstruction may take years and the Bank will be a partner until the job is done," said Praful Patel, Wold Bank Vice President for South Asia Region. "As the reconstruction efforts continues, it is critical that Pakistan strengthens its efforts to reduce future disaster risks. The capacity building component of this operation supports Pakistan's efforts to develop a strategic approach to hazard risk management."

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July-November remittances up 4.61 percent
RECORDER REPORT
KARACHI (December 17 2005): Remittances from Pakistani expatriates have shown 4.61 percent increase in the July-November period of current fiscal year over last year. An amount of $1,683.96 million was received as workers' remittances during the first five months of the current fiscal year, against $1,609.76 million received in the corresponding period of last year registering an increase of $74.20 million, or 4.61 percent.

The amount of $1,683.96 million includes $7.85 million received through encashment and profit earned on Foreign Exchange Bearer Certificates (FEBCs) and Foreign Currency Bearer Certificates (FCBCs).

The remittances from USA, Saudi Arabia, UAE, GCC countries (including Bahrain, Kuwait, Qatar and Oman), UK and EU countries amounted, respectively, to $481.54 million, $280.89 million, $243.26 million, $228.25 million, $172.78 million and $47.76 million, as against $488.83 million, $250.50 million, $257.81 million, $205.64 million, $147.17 million and $39.68 million, respectively, during the corresponding period of last year.

Remittances received from Canada, Australia, Norway, Switzerland, Japan and other countries amounted to $221.63 million as compared to $217.39 million of last year.

The monthly average remittances for the period July-November, 2005 come out to $336.79 million as compared to $321.95 million of last year.

The inflow of remittances into Pakistan from most of the countries of the world increased last month as compared to November, 2004. In November this year, the workers remitted $308.81 million as against $291.81 million in November, 2004, depicting an increase of $17.00 million or 5.83 per cent. According to the break-up, Pakistan received workers remittances during November, 2005 from USA $89.74 million; Saudi Arabia $48.30 million; GCC countries including Bahrain, Kuwait, Qatar and Oman $47.06 million; UAE $46.98 million; UK $24.10 million; and EU countries $8.03 million; as compared to the corresponding receipts from the respective countries during the same month of the last fiscal year ie $81.41 million, $44.88 million, $39.52 million, $43.80 million, $31.26 million and $8.38 million.

Remittances received from Canada, Australia, Norway, Switzerland, Japan and other countries during November, 2005 amounted to $43.84 million as compared to $41.86 million during the same month of the last fiscal year.

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China offers special preferential tariff rates
BEIJING (December 17 2005): Chinese government has approved all necessary arrangements to honour its free trade commitments with Pakistan, offering special preferential tariff rates from next month, said Finance Minister Jin Renqing.

In a statement, Jin hoped that the free trade arrangements would boost their bilateral trade. "We are moving towards free trade arrangements for common interest, under the Early Harvest programme (EHP) finalised by the two countries here last week."

According to the EHP agreement, some 486 categories of Chinese goods exported to Pakistan will enjoy the zero-tariff treatment, mainly vegetables, fruit, stone materials, textile machinery and organic chemical products.

Meanwhile, China will give zero-tariff treatment to 769 categories of goods imported from Pakistan, mainly vegetables, fruit, stone materials, cotton fabrics and man-made fabrics.

For those products with lower tariffs, China will cut its tariffs by 27 percent on 1,671 kinds of products from Pakistan, and Pakistan will cut tariffs by an average range of 22 percent on 575 kinds of products from China.

A senior official of the Chinese Commerce Ministry said the EHP was a significant step towards the Free Trade Agreement (FTA), to be finalised by the end of next year. It would help address the imbalanced trade between them, in which China had a big surplus, he said in an interview with APP.

The bilateral trade between the two countries has been expanding quickly this year. In the first 10 months, the total exports and imports reached US 3.4 billion dollars, soaring 44 percent year-on-year. But the trade is severely imbalanced and, for example, China had a trade surplus of US 1.9 billion dollars last year compared to a total trade volume of US 3.1 billion dollars.

Minister of Commerce Do Xilai said China had noted the situation and he believed the FTA, which had many contents in favour of Pakistan, would help to ease the problem. "And we also encourage Pakistani companies to engage in more market promotion in China, and the Chinese government will give as much support as possible," Bo said at a news conference.

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KARACHI (December 17 2005): Consul General of Russia Vladimir Seliverstov has emphasised the need of early and speedy negotiation on Free Trade Agreement (FTA) between Pakistan and Russia.

Replying to a question during a meeting at Federation of Pakistan Chambers of Commerce and Industry (FPCCI) that Pakistani goods exported to Russia were charged higher duties than similar goods from India, Bangladesh, Turkey and even China, he said that Russia had signed special agreements with these countries.

He suggested that Pakistani parties should enter into joint ventures with Russian companies for export of semi-finished goods from Pakistan for value-addition in Russia and export to European countries (EU).

He said that Russia was interested in increasing economic collaboration with Pakistan. This would be clear from the fact that the Russia has appointed its trade representative in Pakistan after six years.

He said besides this, negotiations were being held for two projects for assembly of tractors and for assembly of small cars in Pakistan. Last year Russia send a small trade delegation to Pakistan, this year a bigger delegation was sent at the time of Expo 2005 and next year efforts were being made to set up a Russian pavilion in Expo 2006.

The Russian Consul General called for activating the MoU signed between the national chambers of Pakistan and Russia in 1999 and urged that FPCCI should establish contacts in this regard with its counterpart body in Russia.

Earlier the Acting President, FPCCI Akbar Abdullah pointed out that trade balance is in the favour of Russia. He said that Pakistan's exports in 2004-2005 stood at 43.91 million dollars and imports at 279.736 million dollars and called for efforts to balance it.

He hoped that the trade and economic relations between the two countries were well on track specially after signing of MoU between the two countries during President Pervez Musharraf's visit to Russia last year.

He proposed that the Pakistan-Russian Business Council and the trade representatives of Russia should jointly suggest specific projects for collaboration between the two countries.

Farrukh Sheikh, Chairman, Pakistan-Russia Business Council, Rauf Tabani and Dr Mushtaq Noorwala suggested co-operation in the banking sector, establishment of mechanism for arbitration in trade disputes and transfer of technology from Russia to Pakistan in light industrial sector.

The Russian Trade Representative Rishat Khalikov and the Deputy Trade Representative Vitaly A. Glinkin were also present in the meeting.

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KARACHI, Dec 16: Terming the private sector as the real engine of growth and development, Prime Minister Shaukat Aziz has asked the business community to take full advantage of investment-friendly policies and enabling environment provided by the government.

He also called upon them to make efforts to project Karachi as the hub of commercial activities at the regional and international level.

The prime minister was talking to a delegation of the Karachi Chamber of Commerce and Industry at the Governor’s House here on Friday.

Sindh Governor Dr Ishratul Ibad Khan and Chief Minister Dr Arbab Ghulam Rahim also attended the meeting.

“Wide ranging structural reforms, prudent economic measures initiated by the government during the last six years and consistency and continuity of economic polices have not only helped the country achieve macroeconomic stability, but also propelled Pakistan along high growth-trajectory,” said the prime minister.

Shaukat Aziz said he was hopeful that despite the devastation caused by the earthquake and unprecedented increase in oil prices internationally, the economy was gaining strength and the country would be able to achieve its growth target.

“The growth continues to be robust. Pakistan has 19 million cell-phone users, teledensity is 17 per cent and growth in the mobile sector is the second highest in Asia.”

He pointed out that at present the government was focusing on bridging the skills gap and would provide short and long-term training skills development programmes.

The prime minister said a stable economy and a functioning democracy had transformed Pakistan’s image at the international level.

The prime minister asked the delegation to make efforts for projecting Karachi as a viable commercial centre and a place suited ideally to investment.

Answering a question, he said the government being aware that industrial land was critical for development of industries, had finalized a policy to provide land on subsidised rates to potential investors and entrepreneurs.

The prime minister said the government was focusing on making Karachi a business-friendly city and it had been trying to provide all necessary facilities and remove hurdles in trade and business activities.

“Karachi is the heart of country’s economy and we are determined to make it even more suitable for the promotion of trade and investment. The transparency and continuity of government policies have encouraged domestic and foreign investors and investments in Pakistan are all time high,” the prime minister added.

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India and Pakistan on Saturday agreed in-principle to begin construction of the over $7 billion Iran-Pakistan-India gas pipeline by mid 2007 so that the first gas flows by the end of 2010.

Initially, India will draw 60 million standard cubic meters per day from the over 2,100-km pipeline project and ramp it up to 90 mmscmd in next 2-3 years while Pakistan would start with 30 mmscmd and double its offtake by 2013, Pakistan's Petroleum Secretary Ahmad Waqar said.

The three countries, which till now have been meeting only bilaterally -- India has held talks with Pakistan and Iran separately and Pakistan with Iran separately -- will for the first time hold a trilateral meeting in early February 2006 in Tehran.

The meeting would address the issues relating to the project, including an integrated feasibility study, project structure and tri-partite framework agreement.

"The project structure (how the project will be built and operated) and the Framework Agreement (the agreement between India, Pakistan and Iran on the pipeline) will be finalised by April 2006," Petroleum Secretary SC Tripathi said at the end of two-day meeting of the Indo-Pak Joint Working Group on the project.

Ahmad Waqar, who led the Pakistani side a the third JWG, said a technical sub-working group would be set up to sort out issues like transportation tariff, transit fee payable to Pakistan, system configuration, pipeline route and pricing mechanism.

The sub-group would meet on a monthly basis to resolve the issue before the next JWG meeting in early March 2006.

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ISLAMABAD, Dec 17 : An ambitious ‘North-South Corridor’ package worth $5 billion would be implemented aimed at making Pakistan a regional trade hub by revamping communication links with Afghanistan and Central Asian States.

Advisor Ministry of Finance Dr Salman Shah told a local TV channel that Pakistan Railways and National Transport Goods Services would be modernised and made efficient.

Prompt clearance of goods at Karachi port would be ensured by modernising and improving it, he added.

Registering a constant declining trend the food inflation has come down from 14 to 4 percent since April last due to the increased supply of wheat, sugar, vegetable and meat. Overall Consumer Price Index (CPI) has come down to 8 from 11.5 percent, he said. Stating other reasons for decline in inflation ratio he said the tightening of monetary policy of state bank of Pakistan has also contributed to it. The inflation would further be brought down to five percent during the next two years, he added.

The prices of building material like cement and steel have also decreased substantially.

Commenting on the realisation of donors conference pledges worth $ 6.3 billion he said talks on soft loans of almost $ 1.4 billion have been completed. Talks were continuing on the remaining pledges. Efforts were underway to totally de-regulate the import of fertilizer to avoid its shortage, he said. About stock market he said stock markets would be made efficient, credible to attract international finances.

http://www.pakistanpapers.com/

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ISLAMABAD, Dec 17 : After a lull of months Pakistan’s economic managers have restarted discussion on the most favoured nation (MFN) status for India with officials here saying New Delhi is most likely to get this status in near future.

“The economic managers are now more than inclined to extend the MFN status to India and this opinion is based on thinking that once SAFTA comes into force, India would automatically get all the trade advantages linked with the MFN position,” official sources in Islamabad said.

“Those strongly in favour of MFN status for India in Pakistan’s ruling circles held the view that the country must move to trade with New Delhi based on MNF status before the South Asian Free Trade Agreement comes into force,” they added.

Pakistan’s policy makers believed that it’s better to reap political advantage of this economic move before it is too late, they said.

They believe that liberalization of trade with India is also of advantage in terms of lower prices for consumers. Moreover, they say there will be more revenue for Pakistan from being able to tax the existing illegal trade.

The sources said this new approach was a clear deviation on the part of Pakistani leadership from the path it had opted in the past and that was to link MFN status for India with the resolution of political issues including Kashmir.

The officials here said that India had been annoyed by Pakistan’s old stance and it was under pressure from various lobbies to withdraw MFN status it had already given to Pakistan. But now positive signals from Islamabad had placated its reservations and concerns.

It was only a couple of days ago that the Congress-led Indian government ruled out withdrawing the MFN status given to Pakistan, said an official asserting it was only after Pakistan had sent positive signals across the border.

They said India believed that Pakistan was bound to grant it MFN status because of its obligations under WTO and hence it has constantly been demanding the extension of vital trade facility from Islamabad since the commencement of ongoing peace process back in January 2004.

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ISLAMABAD (December 18 2005): Cement production capacity of the country would be doubled from the current 20 million tons to 40 million tons per annum within the next two years.

Tariq Saighol, Chairman, All Pakistan Cement Manufacturers Association, told a private TV channel that a gigantic expansion programme was being pursued by the manufacturers for enhancing their production capacity.

Due to surge in economic activities in the country the demand for cement was increasing with the rate of 18 percent per year, he said.

Commenting on recent decrease in cement prices he said that eased demand position had forced the manufacturers to reduce the prices. Cement is now available at Rs 263 to 270 per bag.

Cement was being exported to Afghanistan and Middle East, and quite a few consignments ha been sent to Iraq, he added.

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KARACHI (December 18 2005): Prime Minister Shaukat Aziz on Saturday called upon the foreign investors, businessmen, industrialists and entrepreneurs to avail themselves of the tremendous opportunities of investment in Pakistan, created in the wake of rapidly growing middle class and the enabling environment provided by the government.

He was addressing a delegation of Overseas Investment Chambers of Commerce and Industry including members of the American Business Council who called on him at the Governor's House.

Sindh Governor Dr Ishratul Ibad Khan and Chief Minister Dr Arbab Ghulam Rahim were also present on the occasion. The Prime Minister said "Pakistan of today is the Pakistan of opportunity, hope and promise" and it is a country on the rise.

"With the right kind business environment, consistency, continuity and transparency of policies, the prospective investors will find themselves well placed to grow and prosper", he observed.

The Prime Minister said the country this year was expecting foreign direct investment to the tune of US $2-3 billion.

He said a stable exchange rate, low inflation, strategic location and availability of inexpensive but hard working labour make Pakistan a country suited ideally for investment.

The Prime Minister said that the process of reforms, which lies at the core of our economic turnaround, would continue.

"We are constantly reviewing and improving our policies in line with that of our philosophy to restrict the government's role to a facilitator and enabler only, for promoting business activities all over the country", he said and added, "we are committed to promote investment and provide a level-playing field for all investors local as well as foreign.

Welcoming the appointment of George Bush Senior as the UN Special Representative for Pakistan, the Prime Minister said that this step alone reflects the confidence being enjoyed by the country internationally.

He also referred to the success of the recently held Donors' Conference in this connection.

The Prime Minister said that presently the government is focusing on poverty alleviation in the rural areas of the country, where the bulk of its population lives.

"Our policies are geared to benefit the rural segment of the society and indications are there to suggest that things are on way to improvement".

Shaukat Aziz pointed out that emergence of middle class with growing purchasing power is indeed reflective of a healthy and robust economy.

Terming transparency and efficiency as the hallmarks of the government policies, the Prime Minister informed the delegation that promulgation of "Fiscal Responsibility Law" by the Parliament is a step of revolutionary nature as only 4-5 countries in the world have this law and which is expected to bring in even greater transparency in our dealings besides restricting borrowing to a specified limit.

The Prime Minister also referred to international standard logistics chain being developed in the country and the North-South corridor as some major steps undertaken to improve, promote and expand the business related activities all over the country.

Thanking the businessmen and investors for their valuable contribution towards the relief of earth quake victims, the Prime Minister urged them to actively take part in the Sponsorship Scheme launched by the government for affected areas. The members of the delegation commended the government's performance in the economic fields and lauded its business friendly polices which, they observed, are projecting Pakistan as the hub of business and industry.

"Corporate celebrities are making a beeline to Pakistan as the country has emerged lately as the one enjoying investors confidence" they maintained.

Hari_Om

Neo,

Talking of investments, what is the status on the below deal which is now close to 2 years old ? :

Microsoft to invest $7b in Pakistan’s IT sector