Wheat Tender, ATT Fee Waived, Pak-Iran Gas & Pak-Rus Oil Deal, Oil Imports Under-Invoicing, BRICS membership request, Intl Gold & Oil Prices.

TOPLINE

• Pakistan's Trading Corporation has issued an international tender for 110,000 metric tons of wheat. The shipments are aimed at cooling rising flour prices and should arrive in Pakistan by Feb. 12, 2024, with the agency having the flexibility to buy 10% more or less than the specified volume.
• The Federal Board of Revenue (FBR) in Pakistan has waived the 10% processing fee on specific categories of Afghan transit commercial goods, including confectionaries, chocolates, footwear, machinery, blankets, home textiles, and garments. The exemption applies to cargo arriving at Pakistani ports between October 3-November 16, 2023.
• Pakistan is engaging with U.S. authorities through diplomatic channels to seek exemption from sanctions on the Pakistan-Iran Gas Pipeline Project. Separately, Russia is reportedly unwilling to agree to a long-term commercial oil export deal with Pakistan at a capped price of $60 per barrel.
• The Customs Intelligence Karachi detected a major under-invoicing scheme in vegetable oil imports from Indonesia, with the importer using fake invoices to clear goods at lower values, causing an estimated Rs 275 million in duty and tax evasion.
• Pakistan has formally requested membership in BRICS for next year despite the Indian roadblock.
• Gold prices surged to a more than six-month high, surpassing $2,000/ounce on Monday, propelled by a weakening dollar and anticipations of a halt to US interest rate hikes. Oil prices declined on Monday, with the Brent benchmark hovering around $80 per barrel, as investors awaited the upcoming OPEC+ meeting and supply curbs extending into 2024.

COMMODITIES - CROPS, LIVESTOCK & HORTICULTURE

• Wheat Tender: Pakistan's International Sourcing - Pakistan's Trading Corporation has issued an international tender for 110,000 metric tons of wheat, excluding Israel and India as sources, with a submission deadline of Dec. 27. The shipments, aimed at cooling rising flour prices, should arrive in Pakistan by Feb. 12, 2024, with the agency having the flexibility to buy 10% more or less than the specified volume. [BR] [ET] [MM] [Agri Census]
• Customs Crackdown: Under-invoicing Scam in Vegetable Oil Imports - The Customs Intelligence Karachi detected a major under-invoicing scheme in vegetable oil imports from Indonesia, with the importer using fake invoices to clear goods at lower values, causing an estimated Rs 275 million in duty and tax evasion. Efforts are underway to retrieve original invoices. [BR]
• Textile Opportunities: Kazakhstan Urges Pakistan's High-Value Focus - Kazakhstan is seeking increased textile imports from Pakistan, citing the significant potential to access the Central Asian country's $2 billion textile market. The Kazakh ambassador, Yerzhan Kistafin, emphasized the need for Pakistani textile groups to concentrate on high-value products. [The News]
• China Boosts Exports: 14.3% Growth in Regional Trade - Exports to nine regional countries, including China, showed year-on-year growth of 14.3% in the first four months of the current fiscal year, reaching $1.443 billion compared to $1.263 billion in the same period last year. The increase was attributed to higher shipments to China, as per data released by the State Bank of Pakistan on Monday. [Dawn]
• Pakistani Delegation Explores Trade Opportunities in Shengze, China: A Pakistani delegation, led by Consul General Hussain Haider in Shanghai, visited Shengze Oriental Textile City in Suzhou, China, discussing trade and investment environments. Currently, Pakistan's textile exports to China focus on cotton yarn, apparel, cotton fabrics, and home textiles, with cotton yarn constituting 73% of the total. [ET]
• PPMA Chairman Stresses Global Expansion for Pakistani Pharma: The Chairman of the Pharmaceutical Manufacturers Association (PPMA), Mian Khalid Misbah-ur-Rehman, highlighted the potential of the Pakistani pharmaceutical industry to earn foreign exchange through global drug exports. He emphasized the need for a growth strategy, regulatory overhaul, drug price deregulation, strengthened intellectual property rights, and a policy regime to realize this potential. [BR]
• Coastal Potential: Karachi & Thatta Ideal for Dragon Fruit Cultivation - Successful dragon fruit cultivation in Sindh is seen as a potential game-changer for Pakistan's economy, with progressive farmers eyeing large-scale exports. The coastal areas, especially Karachi and Thatta, are considered ideal for this endeavor. [ET]

AGRI-INPUTS, WEATHER, WATER & POWER

• Pakistan Seeks Exemption for Iran Gas Pipeline: Pakistan is engaging with U.S. authorities through diplomatic channels to seek exemption from sanctions on the Pakistan-Iran Gas Pipeline Project. Minister Muhammad Ali visited Iran to discuss the project, aiming to develop a consensus. The Gas Sales and Purchase Agreement was signed in 2009, with Iran committing to supplying 750 MMCFD of gas to Pakistan. [BR]
• Senate Panel Questions Foreign-Funded Power Projects Procurement: A Senate panel raised concerns about the procurement of foreign-funded power projects, instructing Nespak to wait to finalize an agreement with a local firm under suspicious circumstances. The committee, led by Saifullah Abro, addressed Nespak's non-compliance with orders regarding a re-evaluation report and the status of an ADB-funded project involving ACSR Bunting Conductor. [Dawn]
• FBR Waives Processing Fee for Afghan Transit Goods: The Federal Board of Revenue (FBR) in Pakistan has waived the 10% processing fee on specific categories of Afghan transit commercial goods, including confectionaries, chocolates, footwear, machinery, blankets, home textiles, and garments. The exemption applies to cargo arriving at Pakistani ports between October 3-November 16, 2023, with the fee reinstating after this period. [BR]
• Kohinoor & Nation Trust Partner for Mineral Business: Pakistani yarn manufacturer, Kohinoor Spinning Mills Limited, has signed an MoU with UAE-based conglomerate Nation Trust Holding through its subsidiary EMNOC to establish a raw and value-added mineral-based business in Pakistan. EMNOC is a mineral supplier/importer in the UAE. [The News]
• ACWA Power Faces Hurdles in Pakistan Solar Projects: Saudi firm ACWA Power is facing challenges in finalizing solar project agreements in Pakistan due to security concerns and the absence of key enabling factors. The issue was discussed in a meeting between Pakistan's Ambassador in Riyadh, ACWA Power's Chairman Muhammad Abunayyan, and the Saudi Ambassador to Pakistan. [BR]
• Wapda Projects to Boost Pakistan's Water Storage & Hydel Power: Completion of 8 Wapda projects will increase Pakistan's water storage capacity from 30 to 45 days, adding 9.7 million acre-feet. Hydel power generation by Wapda will double to over 18,000MW, with an increase of 9,043MW. [BR] [Dawn]
• Global Pressure: Russia Unwilling to Accept Cap in Oil Deal - Russia is reportedly unwilling to agree to a long-term commercial oil export deal with Pakistan at a capped price of $60 per barrel. The price cap, imposed by the EU and the US to pressure Russia over the Ukraine conflict, aims to ensure a stable fuel supply globally while limiting revenue. [ET]
• Punjab Government Initiates Artificial Rain Efforts for Smog Control: The Punjab government has created a working group to implement artificial rain in Lahore for smog control. Chaired by Chief Secretary Punjab Zahid Akhtar Zaman, the meeting reviewed progress on artificial rain and smog reduction towers in the city. [BR] [ET]

AGRI UPDATES & PAKISTAN POLICY

• Billions Spent on State-Owned Enterprises: Federal Minister for Privatisation, Fawad Hasan Fawad, revealed that from 2018 to 2021, the government spent Rs 2.54 trillion on subsidies, grants, and loans to sustain commercial State-Owned Enterprises (SOEs) and emphasized its negative impact on the business environment in the country. [BR]
• PM Kakar Strengthens Ties with UAE President in Abu Dhabi: Caretaker Prime Minister Anwaar-ul-Haq Kakar met UAE President Sheikh Mohamed bin Zayed Al Nahyan in Abu Dhabi, emphasizing the strong ties between the two countries and expressing a commitment to enhance bilateral cooperation. Prime Minister Kakar thanked the UAE for its support and acknowledged the significant contribution of 1.8 million Pakistanis in the UAE. [BR]
• FBR Proposes Tax Reforms to IMF, Targets Non-Filers: The Federal Board of Revenue (FBR) has informed the International Monetary Fund (IMF) that it is proposing tax policy reforms, including a comprehensive plan to register 1 million non-filers of income tax returns using third-party data and the Board's central database. [BR]
• Islamic Bank Stocks Drop on Minister's Deposit Rate Concern: Islamic bank share prices experienced a decline on Monday following Finance Minister Dr. Shamshad Akhtar's statement that customers are being short-changed by Sharia-compliant lenders due to inadequate returns on deposits. Dr. Akhtar suggested that the State Bank of Pakistan (SBP) review the minimum deposit rate (MDR), from which Islamic banks are exempted. [Dawn]
• Foreign Ministry Confirms: Pakistan Seeks to Join BRICS - Pakistan has formally requested membership in BRICS, the group of emerging economies comprising India, Brazil, Russia, China, and South Africa. Mumtaz Zahra Baloch, spokesperson for Pakistan's foreign ministry, described BRICS as an "important group of developing countries" and confirmed the country's formal request to join. [BR] [ET] [Al Jazeera]
• GCIL Plans $5.5 Million Coal Power Plant to Combat Rising Electricity Costs: To tackle rising electricity costs, Ghani Chemical Industries Limited (GCIL) plans to establish a $5-5.5 million, 7MW coal power plant at Port Qasim or a nearby location. The decision by the Board of Directors aims to address high utility prices, a significant raw material for the production of medical and industrial gasses. [BR]
• Foreign Companies in Pakistan Hit 39-Month High - Foreign companies operating in various sectors of Pakistan's economy have set a 39-month profit high, repatriating $272.5 million in October 2023. This marks the second consecutive month without government or central bank restrictions, signaling to global investors that Pakistan is conducive to new investment projects. [ET]? [The News]

INTERNATIONAL – OVERVIEW & MARKET OUTLOOK

• Truce in Gaza Extended by 2 Days with Mediation: The truce between Israel and Hamas forces in Gaza has been extended by 2 days, continuing a pause in seven weeks of warfare. Qatar, along with Egypt, facilitated the agreement, and Hamas confirmed the extension. Israel has not provided an immediate comment. Israeli attacks in the West Bank continued despite the ceasefire. [BR] [BR] [Dawn] [ET] [NDTV] [CNN] [AN]
• Power Outages Hit Russia & Ukraine - Almost 2 million people in Russia and occupied Ukraine lost power after hurricane-force winds and heavy rains caused flooding and severed electricity lines. The storm, with winds over 140 km/h, resulted in at least 4 deaths, including 2 in Russia's Krasnodar region and 1 sailor in the Kerch Strait. [BR] [France24] [France24] [BBC] [AP] [Phys]
• Tensions Rise Over Handling TTP - The Afghan Taliban government has asked Pakistan for alternative solutions to handle the banned Tehreek-e-Taliban Pakistan (TTP) since Kabul refuses to use force against the group. Tensions persist, but the two countries are in contact to address the situation. [ET] [USIP] [Westpoint] [VOA]
• Port Gridlock Crisis: Over 60,000 Containers Stranded in RSA - More than 60,000 containers are stuck at sea, awaiting offloading at South Africa's main port in Durban due to gridlock caused by weather and equipment failures. The backlog is harming the economy, with Durban handling about 60% of the country's container traffic. [ET] [IJ] [PLW] [AJ] [NBC] [Watauga Democrat]
• Climate Models Underestimate Future Extreme Rainfall: Climate models underestimate the increase in extreme rainfall under global warming, suggesting a future with more frequent catastrophic floods unless greenhouse gas emissions are reduced, according to a study. This comes ahead of the COP28 summit in Dubai, raising concerns about limiting long-term warming to the necessary 1.5 degrees Celsius to mitigate the worst effects of human-caused climate change. [BR] [Phys] [Barrons] [Yahoo] [CB]
• OPEC Chief Condemns IEA's Climate Policy Critique: OPEC Secretary General Haitham Al Ghais accused the International Energy Agency (IEA) of vilifying the oil and gas industry. The dispute arose from a note by the IEA stating that the fossil fuel industry faces a "moment of truth" where producers must choose between worsening the climate crisis or transitioning to clean energy. [BR] [Reuters] [MEM] [OPEC]
• Gold Tops $2,000 - Gold prices surged to a more than six-month high, surpassing $2,000 per ounce on Monday, propelled by a weakening dollar and anticipations of a halt to US interest rate hikes, which heightened demand for the precious metal. By 1311 GMT, spot gold had risen 0.6% to $2,013.99 per ounce, marking its peak since May 16, while US gold futures also climbed 0.6% to reach $2,015.00. [BR] [Forbes] [BI] [CNBC] [CBS] [Yahoo]
• OPEC+ Meeting Impact: Oil Falls - Oil prices declined on Monday, with the Brent benchmark hovering around $80 per barrel, as investors awaited the upcoming OPEC+ meeting and anticipated supply curbs extending into 2024. Brent crude futures were down 0.4% at $80.21 a barrel, and US West Texas Intermediate (WTI) crude futures lost 0.4% to reach $75.25, both contracts experiencing a $1 decrease in early trading. [BR] [Reuters] [MS] [CNBC]

PAKISTAN - REMAINDERS

• Chhatiboi Glacier: Along the Yarkhun River feeling the effects of warming. [Dawn] [Dawn]
• Caretaker CM Slams Police: Alleges Patronage of Illegal Activities - Caretaker Chief Minister retired Justice Maqbool Baqar criticized the police, stating that all illegal activities in the province were "patronized by the police," just two days after presenting a charge sheet against civic agencies in the metropolis. During a meeting, he expressed concern over the gloomy law and order situation in Karachi and other parts of Sindh. [Dawn]