- Pakistan’s exports to European countries decreased by 3.57% in the first 11 months of FY24 despite its GSP+ status, which provides duty-free access. The EU Parliament extended the GSP+ status for another 4 years until 2027.
- The Met Office announced that the country will experience a fresh and extended monsoon spell in two phases next week, with Sindh and eastern Balochistan receiving rain until July 9, and Punjab, Khyber Pakhtunkhwa, Kashmir, and Gilgit-Baltistan expected to see rain from July 10.
- President Asif Ali Zardari instructed authorities to expedite the Kachhi Canal project to irrigate 713,000 acres in Balochistan, aiming for completion within 1.5 years. Sukkur Commissioner Fayyaz Hussain Abbasi has formed a task force to launch a ‘million tree project’ within 15 days.
- The electricity base tariffs for 91% of domestic consumers have been revised, increasing by 26% to 51%. The government claims they are committed to protecting lower-income users, calling media coverage of the price hike “misleading” and emphasizing the 14% increase for the highest consumption slabs.
- The Tax-to-GDP ratio was 9% in 2023-24, up from 8.5% the previous year, according to the FBR. The new revenue forecasting report for 2024-25 projects an increase of Rs 1,922 billion, with a total expected revenue collection of Rs 11,174 billion.
- Last month was the hottest June on record globally, according to the EU’s climate monitor. The Copernicus Climate Change Service (C3S) reported that each month since June 2023 has set a new temperature record, marking a 13-month streak of unprecedented global heat.
AGRI-UPDATES - COMMODITIES, POLICY & DEVELOPMENTS
- Flour Millers Refuse Strike Postponement: Flour millers have refused Punjab government's request to postpone their strike until Youm-i-Ashur, aiming to ensure a smooth supply of atta during Muharram. Punjab Food Minister Bilal Yaseen had invited representatives of the Pakistan Flour Mills Association and Progressive Flour Millers Group to discuss the planned strike from July 11, which protests the imposition of withholding tax on atta sales. [Dawn]
- CCP Approves SCL-JKSM Merger: The Competition Commission of Pakistan (CCP) has approved the merger of Shamim and Company (Pvt) Ltd (SCL) with JK Sugar Mills (Pvt) Ltd (JKSM). While JKSM produces and sells refined white sugar and by-products, SCL has been manufacturing and distributing PepsiCo products in Pakistan since 1967. [Dawn]
- Exports to Europe Down Despite GSP+: Pakistan’s exports to European countries decreased by 3.57% in the first 11 months of FY24 despite its GSP+ status, which provides duty-free access for most goods. The European Parliament extended the GSP+ status for another four years until 2027, allowing developing countries like Pakistan to benefit from duty-free or minimal duty on exports to Europe. [Dawn]
- Gilgit-Baltistan Traders Strike Over China Trade Suspension: Gilgit-Baltistan traders have closed their businesses and gone on strike to protest the suspension of trade with China since April. The GB Importers and Exporters Association and the GB Chamber of Commerce and Industries have warned they will block the Karakoram Highway at Sost if their demands are not met by Ashura. [Dawn] [ET]
- Balochistan Tube Wells Solar Project: Prime Minister Shehbaz Sharif announced that an agreement between the federal and Balochistan governments will shift 28,000 agricultural tube wells in Balochistan to solar power within three months. The federal government will fund 70% of the Rs 55 billion project, with the provincial government covering the remaining 30%. [BR] [Dawn]
- Drones Manage Wheat Crops in Punjab: In Punjab, drones now manage wheat crops using advanced systems, allowing farmers to control operations like fertilizing and irrigation via mobile apps. This is part of the China-Pakistan project “High Throughput Crop Monitoring Using Computer Vision for Climate Smart Agriculture,” with 600 farmers involved. Punjab produces 76% of Pakistan’s annual grain output. [ET]
- Zardari Expedites Kachhi Canal Project: President Asif Ali Zardari instructed authorities to expedite the Kachhi Canal project to irrigate 713,000 acres in Balochistan, aiming for completion within 1.5 years. He emphasized federal funding and prioritized timely project execution during a meeting on the Green Pakistan Initiative at Aiwan-e-Sadr. [BR] [Dawn]
- Sukkur Million Tree Project: Sukkur Commissioner Fayyaz Hussain Abbasi has formed a task force to launch a ‘million tree project’ within 15 days, following the proposal by MNA Syed Khursheed Ahmed Shah. The project was discussed in a meeting focused on addressing environmental degradation and climate change impacts in Sukkur city. [Dawn]
- Local Gold Prices Drop: On Monday, local gold prices fell due to a drop in world bullion values. Gold lost Rs 1300 to Rs 245,100 per tola and Rs 1113 to Rs 210,134 per 10 grams, while global gold prices declined by $12 to $2376 per ounce, and silver was $31 per ounce. Domestic silver prices remained steady at Rs 2900 per tola and Rs 2486.28 per 10 grams. [BR]
- Jute Import Value Drops: Rs 253 million was the import value of jute in May 2024, down 75% compared to Rs 1.01 billion in May 2023, according to the PBS. [ET]
ENERGY - WEATHER, WATER & POWER
- Extended Monsoon Spell Alert: The Met Office announced that the country will experience a fresh and extended monsoon spell in two phases next week, with Sindh and eastern Balochistan receiving rain until July 9, and Punjab, Khyber Pakhtunkhwa, Kashmir, and Gilgit-Baltistan expected to see rain from July 10. The office also warned of potential flooding from these downpours. [BR] [Dawn] [ET]
- K-Electric Stake Clarification: K-Electric clarified that Infrastructure & Growth Capital LP no longer has an indirect stake in K-Electric Limited after divesting its shares in K-Power Holding Limited. Finance Minister Muhammad Aurangzeb assured K-Electric that the Rs 4 billion in pending payments collected through the Pakistan Post Office would be resolved. [The News] [BR]
- Relief Package for Electricity: Prime Minister Shehbaz Sharif is expected to announce a relief package for electricity consumers, impacting over 50pc of domestic users, to counter public anger over increased power tariffs. The government will subsidize around Rs 50 billion from July to September, benefiting consumers using up to 200 units, as part of an ad-hoc summer package. [The News]
- Domestic Electricity Tariff Hike: The electricity base tariffs for 91% of domestic consumers have been revised, increasing by 26% to 51%. Despite this, the Energy Minister claimed the government remains committed to protecting lower-income users, calling media coverage of the price hike “misleading” and emphasizing the 14% increase for the highest consumption slabs. [BR] [Dawn]
- PSDP Cut for Subsidies: The government plans to reduce the Public Sector Development Programme (PSDP) 2024-25 to allocate more subsidies to protect domestic consumers facing overbilling issues. This follows a previous Rs 250 billion cut from the PSDP to manage finances without jeopardizing the IMF agreement, with the Power Division seeking Cabinet approval to adjust tariff schedules. [BR]
- OGDCL Boosts Kunnar-11 Production: Oil and Gas Development Company Ltd (OGDCL) has boosted production from the Kunnar-11 well in Sindh to 960 barrels of oil daily. In a stock filing on Monday, the company announced that this increase followed production optimization techniques and the installation of an Electrical Submersible Pump (ESP), demonstrating the potential of mature wells. [Dawn] [The News]
- Sindh CM Orders Flood Contingency Plan: Sindh Chief Minister Syed Murad Ali Shah directed the Irrigation and Relief departments to develop a contingency plan for anticipated riverine floods, following the Met Office's forecast of above-average rains. He emphasized coordination among departments for timely emergency responses, noting the monsoon typically runs from July 1 to mid-September. [BR]
- KPK Farmers Demand Water Supply: On Monday, farmers from Khyber Pakhtunkhwa requested the provincial Irrigation Department to ensure an uninterrupted water supply for those downstream of the Baizai Irrigation Channel. [BR]
PAKISTAN - ECONOMICS, POLITICS & SECURITY
- Federal Administration Rightsizing: The government is rightsizing the federal administration by asking 5 ministries to provide their 2023-24 and 2024-25 budgets and detail their functions by July 12 for the Prime Minister’s Office. The ministries of IT, Kashmir Affairs, SAFRON, and Industries and Production have been instructed to treat this as urgent. [BR]
- Finance Minister's Beijing Visit: Pakistan’s finance minister will visit Beijing this week as Prime Minister Shehbaz Sharif’s envoy to request the restructuring of a $15 billion energy debt. While Planning Minister Ahsan Iqbal’s visit was pre-planned, Finance Minister Muhammad Aurangzeb is being sent as a special messenger, and Pakistan’s ambassador to Beijing will arrange meetings with Chinese officials. [ET]
- Tax-to-GDP Ratio and Revenue Forecast: The Tax-to-GDP ratio was 9 percent in 2023-24, up from 8.5 percent the previous year, according to the FBR. The new revenue forecasting report for 2024-25 projects an increase of Rs 1,922 billion, with a total expected revenue collection of Rs 11,174 billion, based on a traditional forecasting methodology and autonomous growth from FY 2023-24. [BR] [The News]
- Gwadar Free Zone Transactions: The Federal Board of Revenue (FBR) has authorized business transactions of goods trading between the Gwadar Free Zone and the tariff area in Pakistani rupees. This change, enacted through SRO 1006(I)/2024, amends the Customs Rules 2001, allowing transactions in Pak rupees, unlike the previous rules which only mentioned the export of goods into the zone. [BR]
- PIA Privatization Nears Completion: The Standing Committee on Aviation was informed that the privatization of Pakistan International Airlines Corporation (PIA) is nearly complete. The Civil Aviation Authority (CAA), which operates 22 out of 43 airports, including 13 international ones, has faced budget constraints for years, resulting in the use of outdated second-generation equipment. [BR]
- Govt Rejects Rs 25 Billion Railways Grant: The federal government rejected a Rs 25 billion grant for Pakistan Railways’ liabilities, approving only Rs 2 billion instead. The ECC was asked for the larger amount to resolve pension delays, court orders, and improve operations. [ET]
- PMYP Plans $25 Billion IT Industry Boost: Chairman of the Prime Minister Youth Programme (PMYP) Rana Mashhood Ahmed Khan announced a plan to increase the IT industry’s share from $2.5 billion to $25 billion over the next five years. Speaking at the “International Conference on Sustainability in the Workforce,” he outlined a goal to train 200,000 youths in high-tech and IT skills for future job opportunities. [ET]
- Fire at Pakistan Stock Exchange Building: Hundreds were evacuated safely and no injuries were reported in a fire at the Pakistan Stock Exchange building on I.I. Chundrigar Road on Monday. The blaze, which started in a brokerage house office on the fourth floor, spread to the fifth floor before being controlled by rescue officials. [Dawn]
INTERNATIONAL - MARKET, POLITICS, SECURITY & DEVELOPMENT
- Israel Genocide: Israeli forces pounded Gaza City early on Monday and columns of tanks advanced into the heart of the city from different directions in what residents said was ‘one of the heaviest attacks’ since October last year.? The Gaza Civil Emergency Service said it believed dozens of people were killed but emergency teams were unable to reach them because of ongoing offensives in Daraj and Tuffah in the east and Tel Al-Hawa, Sabra, and Rimal further west. [Dawn]
- Russia-Ukraine War: Russia blasted the main children's hospital in Kyiv with a missile in broad daylight on Monday and rained missiles down on other cities across Ukraine, killing at least 41 civilians in the deadliest wave of airstrikes for months. Parents holding babies walked in the street outside the hospital, dazed and sobbing after the rare daylight aerial attack. Windows had been smashed and panels ripped off, and hundreds of Kyiv residents were helping to clear debris. [Reuters] [BBC]
- Pakistani Banks Lead S&P Global Q2 2024 Ranking: Pakistani banks dominated S&P Global’s Q2 2024 ranking of Asia-Pacific lenders, with seven banks in the top 15. Standard Chartered Bank (Pakistan) Ltd., Faysal Bank Ltd., and United Bank Ltd. ranked second, third, and fourth with returns of 64.61%, 62.63%, and 48.92%, respectively. [BR]
- French Left Faces Government Formation Challenges: The French left acknowledged challenges in forming a government after Sunday's election resulted in a hung parliament, thwarting Marine Le Pen's far-right bid. Despite the leftist New Popular Front (NFP) unexpectedly coming first, the lack of a majority suggests potential volatility and gridlock ahead. [BR]
- Kunar Traders Ship Onions to India: Afghan traders from Kunar have shipped their first batch of onions, valued at 91 million Afghanis, to India through Pakistan. The shipment, totaling 8,000 tons, is set to reach India within a month, marking a significant new market opportunity that traders believe will benefit local farmers. [BR]
- Hottest June on Record, C3S Reports: Last month was the hottest June on record globally, according to the EU’s climate monitor. The Copernicus Climate Change Service (C3S) reported that each month since June 2023 has set a new temperature record, marking a 13-month streak of unprecedented global heat. C3S Director Carlo Buontempo emphasized that this trend signifies a significant and ongoing shift in the climate. [Dawn]
- Oil Prices Drop Amid Refinery Shutdown: Oil prices dropped about 1% to a one-week low on Monday due to Hurricane Beryl shutting US refineries and ports along the Gulf of Mexico, and hopes for a Gaza ceasefire easing supply disruption concerns. Brent futures fell 75 cents (0.9%) to $85.79 a barrel, and US West Texas Intermediate (WTI) crude dropped 84 cents (1.0%) to $82.32. [BR]
- Interior Ministry Defends X Ban: The Ministry of Interior has defended the ban on social media platform X, imposed on February 17, citing it as a “threat to peace and national security” due to its role in spreading “misinformation and inciting violence.” In a reply to the Sindh High Court, the ministry argued that X’s hostile elements aim to destabilize the country and create chaos. [Dawn] [ET]
- TikTok Removes 20 Million Videos in Pakistan: TikTok removed 20 million videos in Pakistan during Q1 2024 for violating community guidelines, highlighting its commitment to enforcement. The platform also intensified efforts against spam accounts and content, implementing measures to curb automated spam. [BR] [ET]
- Opinion: Agriculture is Not The Future of Pakistan - “Despite agriculture’s continuing vital role in Pakistan’s economy, it cannot be considered the sole driver of future economic growth. Even to ensure food security, the agricultural sector requires immediate reforms to address its structural issues. However, for sustainable economic development and enhanced growth potential, embracing sectors with higher growth potential, technological innovation, value addition, and better rural-urban industrial integration is crucial.” - By Dr Sobia Rose [BR]
