Pakistan NEWS: 2016-06-19

Saturday, 25 June 2016

NSG terms NPT bedrock of non-proliferation regime

ISLAMABAD: The Nuclear Suppliers Group (NSG) on Friday emphasised that the nuclear Non-Proliferation Treaty (NPT) would remain the bedrock of non-proliferation regime as its annual plenary meeting ended in Seoul without any agreement on admitting the countries that have not signed the treaty.

The group said it would continue its deliberations on the issue of accepting non-NPT states in its fold, but did not elaborate how it intended to proceed with the consultations.

The participants “had discussions on the issue of technical, legal, and political aspects of the participation of non-NPT states in NSG and decided to continue with that,” a communiqué issued at the end of the two-day meeting said.

Brazil, Russia, Mexico, Italy, Romania, Belarus, Turkey, China, Austria, Ireland, Belgium and New Zealand oppose extending concessions to India

India and Pakistan are the two non-NPT states aspiring for the membership of the 48-member international nuclear trade cartel.

The absence of a consensus on the matter proved to be a major diplomatic setback for India and its backers US, Japan and some other Western countries, which seemed to be in a hurry to get India admitted to the group. The condition of signing the NPT — one of the five requirements for new entrants — turned out to be the biggest obstacle for developing a consensus on the Indian application.

Although the NSG agreed to continue discussing the matter, its assertion that “full, complete and effective implementation of the NPT” would remain the basis of the non-proliferation regime implied that any forward movement on non-NPT states would not be easy to bring about.

There were sharp divisions among the members at the plenary session with some insisting on adhering to the NPT condition, while a few others called for putting in place a uniform criteria-based process for new admissions, according to a source who had been following the proceedings in Seoul. And then there was a group supporting the Indian application.

Brazil, Russia, Mexico, Italy, Romania, Belarus, Turkey, China, Austria, Ireland, Belgium and New Zealand were strong critics of extending concessions to India.

Media quoted China’s top negotiator at the NSG, Ambassador Wang Qun, as having said there were “many differences on admitting non-NPT members”. He described the differences as “a matter of principle”.

In his comments, Mr Wang clarified that there was “broad-based support” for adhering to the NPT condition.

“Dozens of countries share China’s view that we need to discuss how we can go forward, how can we deal with non-NPT states as a whole, before taking up India’s case,” he said.

However, in an attempt to hide its diplomatic embarrassment, the Indian side tried to portray that it was China alone that had been blocking its application. Different accounts confirmed that some of the countries that originally pledged support to India reneged during the meeting in Seoul. But the Indian External Affairs Ministry, in a statement without naming China, accused “one country” of “persistently raising procedural hurdles”.

In view of the differences, NSG members could not agree on consideration of individual applications and instead remained focused on discussing issues in general terms, according to the insider.

“The NSG haggled on the agenda and whether individual applications can be considered or not,” he said. “Positions were uncompromising, strong and bitter views were expressed,” he added.

Speaking about lobbying efforts by Pakistan, the source said its argument about strategic stability being a critical factor for achieving non-proliferation objectives had made an impact.

The Pakistani argument has been that the country-specific waiver given to India by the NSG in 2008 served the cause neither of non-proliferation, nor of strategic stability in South Asia. A key message has therefore been that South Asian strategic stability is a critical factor for achieving the object of non-proliferation.

“The need for adopting non-discriminatory and criteria-based approach tying Pakistan and India together, gradually gained acceptance with NSG participants,” the source added.

CORRIGENDUM: In Dawn’s earlier report titled “India’s bid to join NSG hits dead end” it was erroneously mentioned that Foreign Secretary Aizaz Chaudhry led a delegation to Seoul for presenting Pakistan’s case on the sidelines of the NSG meeting. It was instead Pakistan’s Ambassador in Vienna, Ayesha Riaz, who led the delegation to Seoul.

Religious tensions bristle in Myanmar village after mosque destroyed

YANGON: Scores of police have been deployed to guard a village in central Myanmar where religious tensions are running high after a Buddhist mob destroyed a mosque, authorities said Saturday.

It is the latest flare-up of anti-Muslim violence in Myanmar, which has seen sporadic bouts of religious bloodshed since 2012, with a surge of Buddhist nationalism presenting a key challenge for Aung San Suu Kyi's new government.

A muslim man cries after a group of men destroyed a mosque in the village of Thayethamin outside Yangon, Myanmar.— Reuters

The most recent violence erupted this week when an angry mob of around 200 Buddhists rampaged through a Muslim area of a village in Bago province following an argument between neighbours over the building of a Muslim school.

Own Lwin, the local police chief, said the atmosphere remained tense Saturday with around 100 police officers deployed to keep the peace.

“Last night, 50 police guarded the village to prepare for rumours that there might be more unrest. Now we have arranged a police force of up to 100 officers,” he told AFP, adding that no arrests have been made over the destruction of the mosque.

Win Shwe, the mosque's secretary, told AFP that Muslim residents fear for their safety and are planning to move to a nearby town until the tension cools.

“Our situation is not safe and now we are planning to leave the village... We still feel afraid,” he told AFP.

Strident anti-Muslim sentiment has fomented across Myanmar in recent years, with outbreaks of violence threatening to unravel democratic gains since the former junta stepped down in 2011.

The worst religious violence struck central Myanmar and western Rakhine State, which is home to the stateless Rohingya Muslim minority, tens of thousands of whom still languish in displacement camps after rioting.

The interior of the destroyed mosque is seen after the attack.— Reuters

Hardline monks and Buddhist nationalists fiercely oppose moves to recognise the Rohingya as an official minority and insist on calling them “Bengalis” — shorthand for illegal migrants from the border with Bangladesh.

Suu Kyi, a vocal champion for human rights, has been criticised for not taking a stronger stance on the Rohingya or the abuse they face.

This month the UN warned that violations against the group could amount to “crimes against humanity”. The Nobel Peace Prize laureate, now leading Myanmar's first civilian government in decades, has asked for “space” while her administration seeks to build trust between religious communities.

Google, Facebook quietly move toward automatic blocking of extremist videos

SAN FRANCISCO: Some of the web's biggest destinations for watching videos have quietly started using automation to remove extremist content from their sites, according to two people familiar with the process.

The move is a major step forward for internet companies that are eager to eradicate violent propaganda from their sites and are under pressure to do so from governments around the world as attacks by extremists proliferate, from Syria to Belgium and the United States.

YouTube and Facebook are among the sites deploying systems to block or rapidly take down the militant Islamic State (IS) videos and other similar material, the sources said.

The technology was originally developed to identify and remove copyright-protected content on video sites. It looks for “hashes”, a type of unique digital fingerprint that internet companies automatically assign to specific videos, allowing all content with matching fingerprints to be removed rapidly.

Such a system would catch attempts to repost content already identified as unacceptable, but would not automatically block videos that have not been seen before.

The companies would not confirm that they are using the method or talk about how it might be employed, but numerous people familiar with the technology said that posted videos could be checked against a database of banned content to identify new postings of, say, a beheading or a lecture inciting violence.

The two sources would not discuss how much human work goes into reviewing videos identified as matches or near-matches by the technology. They also would not say how videos in the databases were initially identified as extremist.

Use of the new technology is likely to be refined over time as internet companies continue to discuss the issue internally and with competitors and other interested parties.

In late April, amid pressure from US President Barack Obama and other US and European leaders concerned about online radicalisation, internet companies including Alphabet Inc's YouTube, Twitter Inc, Facebook Inc and CloudFlare held a call to discuss options, including a content-blocking system put forward by the private Counter Extremism Project, according to one person on the call and three who were briefed on what was discussed.

The discussions underscored the central but difficult role some of the world's most influential companies now play in addressing issues such as terrorism, free speech and the lines between government and corporate authority.

None of the companies at this point has embraced the anti-extremist group's system, and they have typically been wary of outside intervention in how their sites should be policed.

“It's a little bit different than copyright or child pornography, where things are very clearly illegal,” said Seamus Hughes, deputy director of George Washington University's Program on Extremism.

Extremist content exists on a spectrum, Hughes said, and different web companies draw the line in different places.

Most have relied until now mainly on users to flag content that violates their terms of service, and many still do. Flagged material is then individually reviewed by human editors who delete postings found to be in violation.

The companies now using automation are not publicly discussing it, two sources said, in part out of concern that terrorists might learn how to manipulate their systems or that repressive regimes might insist the technology be used to censor opponents.

“There's no upside in these companies talking about it,” said Matthew Prince, chief executive of content distribution company CloudFlare. “Why would they brag about censorship?”

The two people familiar with the still-evolving industry practice confirmed it to Reuters after the Counter Extremism Project publicly described its content-blocking system for the first time last week and urged the big internet companies to adopt it.

Wary of outside solution

The April call was led by Facebook's head of global policy management, Monika Bickert, sources with knowledge of the call said. On it, Facebook presented options for discussion, according to one participant, including the one proposed by the non-profit Counter Extremism Project.

The anti-extremism group was founded by, among others, Frances Townsend, who advised former president George W. Bush on homeland security, and Mark Wallace, who was deputy campaign manager for the Bush 2004 re-election campaign.

Three sources with knowledge of the April call said that companies expressed wariness of letting an outside group decide what defined unacceptable content.

Other alternatives raised on the call included establishing a new industry-controlled nonprofit or expanding an existing industry-controlled nonprofit. All the options discussed involved hashing technology.

The model for an industry-funded organisation might be the nonprofit National Center for Missing and Exploited Children, which identifies known child pornography images using a system known as PhotoDNA. The system is licensed for free by Microsoft Corp.

Microsoft announced in May it was providing funding and technical support to Dartmouth College computer scientist Hany Farid, who works with the Counter Extremism Project and helped develop PhotoDNA, “to develop a technology to help stakeholders identify copies of patently terrorist content”.

Facebook's Bickert agreed with some of the concerns voiced during the call about the Counter Extremism Project's proposal, two people familiar with the events said. She declined to comment publicly on the call or on Facebook's efforts, except to note in a statement that Facebook is “exploring with others in industry ways we can collaboratively work to remove content that violates our policies against terrorism”. In recent weeks, one source said, Facebook has sent out a survey to other companies soliciting their opinions on different options for industry collaboration on the issue.

William Fitzgerald, a spokesman for Alphabet's Google unit, which owns YouTube, also declined to comment on the call or about the company's automated efforts to police content.

A Twitter spokesman said the company was still evaluating the Counter Extremism Project's proposal and had “not yet taken a position”. A former Google employee said people there had long debated what else besides thwarting copyright violations or sharing revenue with creators the company should do with its Content ID system. Google's system for content-matching is older and far more sophisticated than Facebook's, according to people familiar with both.

Lisa Monaco, senior adviser to the US president on counterterrorism, said in a statement that the White House welcomed initiatives that seek to help companies “better respond to the threat posed by terrorists' activities online".

NAB set to file multi-billion reference against ex-generals, PR officials in land scam

ISLAMABAD: The National Accountability Bureau (NAB) is all set to file a multi-billion reference against three retired generals and former top officials of Pakistan Railways (PR) for their alleged involvement in illegal allotment of 141 acres of railway land to a private Royal Palm Country Club (RPCC) in Lahore in 2001. The case is being investigated by NAB’s Rawalpindi region and it has sought approval of the NAB headquarters for filing reference before the Accountability Court Islamabad.

The NAB’s Rawalpindi region wrote to the bureau’s headquarters in May this year that the case was ripe for becoming a reference. The RPCC is being run by its management for over a decade. An insider told Dawn that the reference was mature and it could be sent any time to the NAB Executive Board for its filing in the court. The investigation of the case that started in 2010 has been completed.

After the National Logistic Cell (NLC) scandal in which three retired generals were penalised for being involved in corruption, the case of RPCC will be the second major corruption scam in which former army generals will be tried.

The RPCC reference carries the names of retired Lt Gen Javed Ashraf Qazi who served as former secretary and chairman PR, retired Lt Gen Saeeduz Zafar who had also served as former secretary and chairman Railway board, retired Maj Gen Hamid Hassan Butt who worked as General Manager PR and a retired Brig Akhtar Ali Baig who served as a director PR.

PR officials involved in the scam included former general manager Iqbal Samad Khan, former member finance Khurshed Ahmed Khan, former divisional superintendent Abdul Ghaffar, deputy director marketing Waseem Aslam, former director marketing Khalid Naqi and a person Pervaiz Qureshi.

It is worth mentioning here that the case of NLC was taken by military authorities at a stage when NAB and Public Accounts Committee of the National Assembly had completed their investigations. Interior Minister Chaudhry Nisar Ali Khan, who was serving as PAC chairman in the previous PPP government, had told media before the case was taken up by the military authority in September 2012, that the PAC had completed its investigation into the RPCC scam. Military authorities decided the case in August last year under which retired Maj Gen Khalid Zahir was ‘dismissed from service’, retired Lt Gen Afzal Muzaffar was awarded ‘severe displeasure’ and retired Lt-Gen Khalid Munir Khan was not found involved in any financial irregularity or misconduct and, therefore, was absolved from all charges.

Afghan man’s ears chopped off for harassing woman in Swabi

SWABI: An Afghan man was severely beaten and his ears were chopped off by villagers allegedly for harassing a married woman in a remote village of Razaar tehsil here on Friday, said police.

It was learnt the woman informed her husband and family about the incident, which occurred in Parmuli village, which caused them to attack the alleged culprit. They severely beat him up and also chopped off both his ears, leaving him bleeding.

Registering an FIR in Parmuli police station, the injured man admitted that the cause of the incident was the woman issue.

Police registered case against 11 people for torturing the man, and began efforts to arrest the accused.

Meanwhile, four persons were critically injured when the car they were travelling in hit a power pylon near Swabi-Jehangira road on Friday. The injured were taken to the District Headquarters Hospital, Swabi, where condition of one of the injured was critical.

Also in the day, the district police seized 30 kilogrammes of charas from a car, but could not arrest the three smugglers who managed to escape, leaving their vehicle behind. The commodity was being smuggled to Punjab. The car was stopped at Shaheed Baba checkpost in Topi. From the identity cards, the fleeing accused left in the car, they were identified as Nasir Khan, Samin Khan and Mukhtiar Anjum of Peshawar.

Monsoon rains to start next week

ISLAMABAD: The Pakistan Meteorological Department (PMD) on Friday said monsoon rains will likely start in the country during the coming week, most probably either on Monday or Tuesday in the upper parts of the country.

All concerned departments are on alert after the Met Office put out a warning alert.

Talking to Dawn, Met Office Director General Ghulam Rasool said widespread construction in Islamabad especially that on hills and drains may lead to urban flooding.

“These are issues related to municipal functions, we can only suggest that there is a need for dredging storm water drains and to stop construction on natural water paths,” he added.

The met office had said before that the monsoon rains will be 20pc heavier than usual this year.

“All concerned authorities are advised to remain alert during the coming week because there is high probability of isolated heavy downpours which may generate flash flooding in hilly terrain and urban flooding in big cities,” the PMD alert reads.

On Friday, the Met Office said widespread rains with isolated heavy thundershowers and strong, gusty winds are expected during the first spell of monsoon in Islamabad, Punjab, Khyber Pakhtunkhwa, Fata and Kashmir. Scattered rains and dust thundershowers are also expected in Sindh and Balochistan in the coming week too.

“Monsoon rains are likely to start in the upper parts of the country which will spread towards central and southern parts of the country during the week,” a PMD official said.

The probability of floods has further increased as ground and water bodies are already full due to active pre-monsoon rains.

“Traditionally, the ground is very dry in the months of May and June and there is capacity in ponds, lakes and canals. But this year, active pre-monsoon rains have already filled this capacity,” the official said.

Meanwhile, in order to effectively counter the possible devastation brought by heavy monsoon rains, especially flash flooding and land sliding, the National Disaster Management Authority (NDMA) held a consultative meeting with the State Disaster Management Authority (SDMA) AJK in Muzaffarabad.

SDMA Director General Zaheerud Din Qureshi briefed the meeting about the preparatory measures undertaken and contingency plans.

NDMA Chairman Major General Asghar Nawaz suggested stocking relief goods, the identification of landslide areas and strengthening community early warning systems in areas including Neelum valley, the upper Neelum valley, Lipa valley and other inaccessible areas.

The NDMA chairman talked about the need for emergency wheat stocking in areas likely to be cut off due to landslide, the engagement of utility stores for pre-positioning food packs in vulnerable areas and the need for timely procurement of relief stocks.

PTI files reference in ECP for PM’s disqualification

ISLAMABAD: The Pakistan Tehreek-i-Insaf (PTI) filed in the Election Commission of Pakistan (ECP) on Friday a reference seeking disqualification of Prime Minister Nawaz Sharif for allegedly concealing his assets.

The 72-page reference filed by PTI leader Yasmin Rashid said the prime minister had not mentioned the offshore companies revealed in the Panama Papers in his statements of assets submitted to the ECP. Since the matter came under the qualification and disqualification clauses of the Constitution, the commission should declare the prime minister disqualified to hold the office.

Talking to reporters after filing the reference, Yasmin Rashid claimed that concrete evidence had been provided to the ECP and expressed the confidence that the prime minister would stand disqualified on the basis of the proof offered by her. She urged the ECP to do justice.

PTI spokesman Naeemul Haq, who was present on the occasion, referred to the failure of the parliamentary committee to reach a consensus on the terms of reference (ToR) for the proposed Panama Papers inquiry commission and said time had come to knock at the doors of the judiciary.

He expressed the hope that members of the ECP would be appointed before Eid, pointing out that a number of cases were pending before the commission because of the absence of its members.

The ECP told the PTI that like other cases its reference would also be heard after the appointment of new members.

Meanwhile, on the order of the Supreme Court, the ECP has repatriated the services of two senior officers to the apex court.

ECP’s additional secretary Syed Sher Afgan and protocol officer of the Chief Election Commissioner Mushtaq Ahmad had come on deputation from the Supreme Court.

Dar visits Sabri family, ailing Edhi

KARACHI: Federal Finance Minister Ishaq Dar on Friday visited the home of qawwal Amjad Sabri in Liaquatabad and met his family to offer his condolence while vowing that the killers would be brought to justice.

Accompanied by Sindh Governor Dr Ishratul Ibad Khan and senator of the Pakistan Muslim League (PML-N) Nehal Hashmi, Mr Dar visited the densely-populated neighbourhood under strong and elaborate security arrangements. He offered Fateha and stayed with the family for a while to share his thoughts and convey condolence message from Prime Minister Nawaz Sharif.

“Prime Minister Nawaz Sharif also shares the grief of the bereaved family,” he said. “The contribution of the Sabri family to the art of qawwali cannot be forgotten. It’s everyone’s loss and the government as well as our law enforcement agencies have a resolve that the killers would be brought to justice.”

Later, the finance minister visited the Sindh Institute of Urology and Transplantation (SIUT) to meet Abdul Sattar Edhi, the founding chief of the country’s largest charity.

“The federal minister also met chief of SIUT Professor Dr Adeebul Hasan Rizvi and inquire after the health of Abdul Sattar Edhi,” said a Governor House statement. “He also spent time with Bilquees Edhi and Faisal Edhi to convey well wishes and prayers for Abdul Sattar Edhi’s early recovery. He also conveyed a message of goodwill from the prime minister to Abdul Sattar Edhi.”

The finance minister also met the SHC CJ in his chamber on Friday and informed him about the efforts being made for the recovery of his son.

‘JITs being formed for Awais Shah kidnapping, Sabri killing probe’

KARACHI: The Sindh government has decided to set up joint interrogation teams (JITs) on the kidnapping of young lawyer and son of the Sindh High Court chief justice Awais Shah and the killing of renowned qawwal Amjad Sabri, said the home minister on Friday.

Sohail Anwar Siyal added that the JITs composed of representatives of intelligence agencies, Rangers and police would help take forward the investigations into the two high-profile cases.

He announced a reward of Rs5 million for any information leading to the arrest of killers of Amjad Sabri.

Speaking at a press conference at the Karachi Police Office (KPO) after chairing a meeting in which the progress in both cases was reviewed, the home minister said the domain of investigation into the kidnapping of Awais Shah had been enhanced and now the investigators would also work in other provinces.

The minister regretted that the kidnapping incident took place at around 2.30pm, but the police were not aware of it until 9pm.

He said the gap of six hours was huge, however, investigators had got ‘some clues’ and they were working on them.

Mr Siyal deplored that the federal government appeared reluctant to give a no-objection certificate to the Sindh government for access to the Global System for Mobile Communications (GSM) locators.

“Lack of access to GSM locators, geo-fencing and Nadra family tree was creating hindrance for the Sindh police in investigation purposes,” the minister said.

However, he expressed the hope that with taking up this issue at the apex committee, they hoped to get access to GSM locators.

Inspector General of Sindh police A. D. Khowaja, on this occasion, admitted that investigations into both the high-profile cases were still at an ‘extremely initial level’ as the kidnappers had not made any call, nor responsibility was claimed by anyone.

The police had conducted a search operation in Dadu and Jamshoro but they could not get any ‘positive lead’, he said.

Replying to a question, Additional Inspector General of police of Karachi Mushtaq Ahmed Mahar said they had enhanced security to the extent that a few major shopping centres were virtually closed on June 17 over receiving terror threat, but the police had not received any report about the high-profile kidnapping or killing.

The IG police also corroborated his views by saying that the police had not received any intelligence report about high-profile personality’s purported target in Liaquatabad.

Replying to a question about taking action against ‘facilitators’ mentioned in the JITs, the adviser to the chief minister on law, Murtaza Wahab, said no concrete evidence had emerged against the purported facilitators in these reports.

The home minister on this occasion added that ‘last paragraph’ of all JITs reports usually mentioned that ‘further probe’ was needed because JITs were mainly based on statements of suspects.

Replying to a question, IG Khowaja admitted that closed-circuit television cameras were not much help for police in investigation as their quality appeared to be below standards.

He pointed out that there over 2,000 secret cameras installed in the city. Out of which 967 belonged to the Sindh police, 1,400 to Karachi Metropolitan Corporation and 100 to traffic police for traffic management.

The provincial police chief revealed that KMC’s 90pc cameras were functional while only 20pc cameras of police were functioning.

Most of the secret cameras of the police had stopped functioning because of lack of provision of funds for maintenance. However, he disclosed that in new financial year, the provincial government had earmarked budget for this purpose and the police were expected to make these cameras ‘functional’, but further improvement would require ‘specific budget provision’ to bring these cameras to meet international standards.

The IG police pointed out that there were 60,000 cameras installed in London, which was a small city as compared to Karachi, indicating that the metropolis needed much more cameras.

He said they were also revamping the Special Branch as this branch had a ‘technical edge’ over other units of the police.

“These cameras had been found less helpful in detecting crimes but it did not mean that these cameras were useless,” opined the IG police.

Replying to another question, the IG police suggested that terrorism would not end in days, but instead it was a ‘constant’ fight against terrorists.

Referring to Friday’s terror act in Quetta and past acts in Peshawar and Lahore, IG Khowaja said after launching Zarb-i-Azb “we are fighting ideological war and this is the war of the whole nation”.

Earlier, at the start of the press conference, the home minister urged the media especially electronic to avoid leaking information or CCTV footages, which may ‘benefit’ criminals.

Mr Siyal also advocated a sort of regulation or some check on social media as unverified news was being shared/commented there.

Govt to release banks’ held-up money amounting to Rs3bn

KARACHI: Finance Minister Ishaq Dar has assured banks that they would soon get Rs3 billion reimbursement of telegraphic transfer (TT) charges from the budgeted allocation of 2015-16.

Banks are paid for each transaction of remittances sent by overseas Pakistani workers. However, Rs3bn has been held up by the government.

The finance minister was in Karachi on Friday where he addressed the heads of banks along with the State Bank of Pakistan (SBP) Governor Ashraf Mahmood Wathra.

The minister said reserves would improve further and may touch $23bn by the end of this fiscal year. “We expect another $1bn from IFIs [international financial institutions] in the coming week,” he said.

While reiterating that Pakistan would not approach the International Monetary Fund (IMF) for another loan, Mr Dar said it was the first time that Pakistan was going to complete IMF Macro-economic Stabilisation Programme.

Elaborating the fiscal improvements, he stated that the budget deficit has improved to 4.3 per cent from 8.8pc three years ago without compromising on development budget. “The process of fiscal consolidation will continue to lower the deficit,” he said.

The government’s borrowing from the banking system has shrunk which has created space for the banks to lend to the private sector, he added.

He urged banks to take advantage of this space and increase credit to the private sector, particularly to the small and medium enterprises and microfinance sectors as well as to the housing sector. To promote mortgage financing in the country, he stressed the importance of having a foreclosure law because “without such laws housing finance cannot be promoted”.

The minister said that economic parameters have recorded significant improvement over the last three years and it was time to accelerate the growth momentum of the economy.

Appreciating State Bank’s efforts in the financial sector, he said its monetary policy has played a great role in achieving economic turnaround. “SBP’s efforts with regard to financial inclusion have earned international recognition,” he said.

US offers dollar liquidity to calm unsteady markets

WASHINGTON: The US Federal Reserve on Friday offered to provide dollar liquidity to soften the impact of Britain’s exit from the European Union as President Barack Obama pledged to maintain close ties with both the EU and UK.

The referendum results, announced early Friday, triggered global financial and political havoc forcing British Prime Minister David Cameron to announce his plan to resign this fall.

In a move aimed at steadying the financial world, US Federal Reserve announced it was prepared to provide “dollar liquidity through its existing swap lines with central banks, as necessary, to address pressures in global funding markets.”

Such pressures on the global market “could have adverse implications for the US economy” as well, it added.

President Obama had earlier urged British voters not to leave EU as it would have devastating consequences for the British and world economies but on Friday he said he respected the exit vote.

“The people of the United Kingdom have spoken, and we respect their decision,” said Mr Obama in a statement issued by his office.

The US leader pointed that the United States and Britain had a special and enduring relationship and the United Kingdom’s membership in Nato remained a vital cornerstone of US foreign, security, and economic policy.

“So too is our relationship with the European Union, which has done so much to promote stability, stimulate economic growth, and foster the spread of democratic values and ideals across the continent and beyond,” President Obama added.

Canada, IMF support UK

Canadian Prime Minister Justin Trudeau also emphasised this point, saying that the UK and the EU were important strategic partners for Canada with whom it enjoyed deep historical ties and common values. “We will continue to build relations with both parties as they forge a new relationship,” he said.

Mr Trudeau also noted that earlier Friday Prime Minister Cameron indicated his intention to resign by the fall.

“On behalf of all Canadians, I would like to thank him for being such a close ally and good friend to our country,” he added.

Managing Director of the International Monetary Fund Christine Lagarde urged British and European authorities to “work collaboratively to ensure a smooth transition to a new economic relationship between the UK and the EU.”

Large-scale manufacturing grows by 4pc

ISLAMABAD: Large-scale manufacturing (LSM) grew by 3.92 per cent in the first 10 months of the outgoing fiscal year from a year ago period reflecting a partial revival in the industrial output.

On a year-on-year basis, the LSM grew by 3.15pc in April 2016 over the corresponding month of last year, showed data released by the Pakistan Bureau of Statistics on Friday.

Industry-specific data shows that automobiles recorded highest growth of 20.39pc, fertilisers 15.47pc, non-metallic mineral products 10.39pc, chemicals 9.42pc, rubber products 8.13pc, leather products 7.66pc, pharmaceuticals 6.29pc, food, beverages and tobacco 1.83pc, coke and petroleum products 0.10pc and textile 0.56pc.

The other sectors that showed decline included wood products 60.1pc, engineering products 13.98pc, iron and steel products 8.94pc, electronics 3.45pc, and paper and board 1.75pc.

The Ministry of Finance in its latest report listed several factors contributing to growth in the LSM in the last few months. The growth is achieved despite delayed growth coming from sugar and closure of Pakistan Steel Mills since July 2015 when Sui Southern Gas Company suspended gas supply to the mills due to non-payment of bills. The sugar industry started giving positive growth results in March 2016 after witnessing a negative growth in February.

The decline in global commodity prices benefited many industries, such as food, automobile, cement and chemical and construction activities, Punjab government’s Apna Rozgar Scheme and improved availability of gas supplies to fertiliser and cement sectors.

The Overseas Investors Chamber of Commerce and Industry in its latest business survey stated that improvements in energy management and law and order have led to an upturn in confidence of the business community as the Business Confidence Index — Wave 12 — touched a record level of 36pc, showing an improvement of 14pc over the previous survey result announced in November 2015.

The LSM sector also benefitted from the continued improvement in the supply of electricity and gas, coupled with expansion in credit to private sector which remained high due to lower cost of credit and better market conditions. A welcome development is the rise in net credit disbursement for fixed investment.

Many firms are expanding their operations by availing fixed investment loan. Credit for fixed investment reached Rs150.147bn, an increase by 78pc during July-March FY-2016 against Rs84.365bn in comparable period of FY-2015. The expansion was particularly notable in sugar, fertiliser, pharmaceutical, telecommunications, road transport, construction of roads, manufacturing of electricity, machinery, cement, chemical sectors, etc.

In the automobile sector , growth was mainly achieved from LCVs production which increased by 48.70pc, buses 82.32pc, jeeps and cars 24.96pc, trucks 42.02 and motorcycles 17.28pc.The only decline was witnessed in the production of tractors which declined by 35.39pc. The improvement in the automobile sector is due to stable exchange rate, continuation of concessions under Apna Rozgar scheme launched by the Punjab government, appetite for new model and focus of commercial banks on auto financing.

The growth in chemical sector mainly arrived from sulphuric acid which recorded a growth of 17.50pc, paints and varnishes 14.08pc and caustic soda 24.08pc.

The exceptionally well performance mainly arrived due to construction activities and start of commercial operation by caustic soda producing unit.

In pharmaceuticals groups, capsules, injections, liquids/ syrups and tablets recorded a growth of 8.19pc, 11.61pc, and 8.02pc, respectively.

In non-metallic mineral products, cement managed to grow by 10.54pc during July-April FY-2016 over last year. The steep fall of global coal prices helped cement manufacturers. In addition, cement industry also benefitted through vibrant construction activities and reduction in policy rate.

Coke and petroleum products growth mainly arrived from the production of LPG 16.86pc, lubricating oil 13.32pc, motor sprits 1.49pc and jet oil 7.05pc.

The food, beverages and tobacco remained under stress mainly due to delay in cane crushing during this season.

However, some items showed positive growth during July-April FY-2016 which included tea blended which grew by 16.36pc, soft drinks 5.13pc, cooking oil 7.60pc, and vegetable ghee 5.91pc.

The production data of LSM has been received from the Oil Companies Advisory Committee (OCAC), comprising 11 items; ministry of industries and production comprising 36 items and provincial bureaus of statistics, comprising 65 items which contributed to LSM growth by 0.26pc, 2.96pc and 1.48pc, respectively.

Sales tax deductions to be automated from July 1

ISLAMABAD: The Federal Board of Revenue (FBR) has said that sales tax deductions will be made through an automated system from July 1.

In this regard, the FBR has developed software for the automated verification of Sales Tax Registration Number (STRN) and deduction of applicable rates of sales tax from vendors’ claims submitted at accounting offices.

Ahead of the software’s implementation on July 1, the FBR has started contacting government departments and ministries to instruct concerned staff to ensure purchases are made from registered vendors.

The departments were also instructed to ascertain that vendors’ STRN and master-records with accounting offices are validated to avoid deduction of full applicable sales tax from respective vendors.

An official statement issued here said that the system will be implemented across all accounting offices from the start of financial year 2016-17 and is expected to significantly enhance the performance of accounting offices in their role as withholding tax agents for the government, and contribute substantively to the government’s sales tax collection.

The system will link up with the FBR database to determine status of vendor’s sales tax registration and authenticity of STRN as well as authenticity of allied master-data of the vendor in database of the accounting office, and calculate correct amount of sales tax to be withheld in line with the applicable rates as determined by FBR.

Based on verifications along the above mentioned dimensions, the system will deduct applicable rates – 10 per cent, 20pc and 100pc of the sales tax.

Full applicable rate of sales tax shall be deducted from claims of those vendors who do not have STRN, whose STRN does not get validated from FBR database or who are blacklisted.

The software was developed by the IRS-Operations Wing of FBR in collaboration with the Office of Controller General of Accounts following a pilot project launched earlier this year at AG Office Islamabad.

Gold posts biggest rally since 2008

LONDON: Gold soared the most since the global financial crisis in 2008 on Friday, after Britons shocked markets by voting to leave the European Union, fueling market turmoil that drove investors toward safe-haven assets.

The precious metal jumped as much as 8pc to its highest in more than two years, tracking the rally in other safe havens, such as bonds, as risky assets were dumped from stocks to sterling.

Spot gold was up 5.1pc at $1,319.60 an ounce by 0639 GMT, after earlier peaking at $1,358.20, the strongest since March 2014. Gold soared nearly 11pc in September 2008.

Gold priced in other currencies also surged. In terms of sterling and euro, gold hit the highest since April 2013. In Australian dollar terms, gold touched a record high. Gold on the Shanghai Futures Exchange rose to the highest since September 2013.

Spot silver was up 2.4pc at $17.69 an ounce. Platinum was up 1.4pc at $973.75 and palladium dropped nearly 3pc to $548.

Brisk trading on cotton market

MULTAN: Trading on the cotton market was brisk on Friday amid strong demand from spinners, though short supply of cotton somewhat slowed down the activity. The Karachi Cotton Association, however, reduced its spot by Rs50, to Rs5,550 per maund.

Cotton brokers said that increasing interest of Indian spinning mill owners in Pakistani cotton has accelerated the local market.

They said that July will be very crucial month in connection with the cotton as there is an increasing trend in the prices of cotton in the Indian cotton market.

The price of benchmark Shankar-6 variety of Indian cotton has been furthered increased by Rs200 to Rs40,500 on Friday.

They said that the referendum regarding the disintegration of the UK from the European Union kept the future deals of the New York cotton market in pressure; however, the prices in the Indian cotton market are being increased with each passing day.

India, the second-largest country producer, is the second-largest market for All Pakistan Textile Mills Association, but Indian sipping mill owners are now searching the commodity in the markets all over the world.

They said the prices in both Indian and Pakistani markets are being increased and one can easily assess the future of cotton while keeping in view the increasing trend in its prices.

Prices of phutti (seed cotton), which have crossed Rs3,500 per 40 kilograms, will possibly jump further on Saturday (today).

The remaining stock of old crop is not more than 50,000 bales while expected production for the month of July is 110,000 bales so the total available quantity will be 160,000 bales against the required quantity of 410,000 bales for the month.

The price of phutti in Sahiwal was Rs3375, Umer Kot Rs3300, Kunri Rs3275, Jhadu Rs3250, Thatta Rs3375 and Khanewal Rs3125.

Major deals on the ready counter were: 200 bales from Tando Adam at Rs6100, 200 Khangarh at Rs6070, 400 bales Mirpur Khas at Rs6050, and 200 bales Hyderabad at Rs6075.

Deals of new crop included: 400 bales from Bahawalpur at 6000, 1500 bales Sadiqabad at Rs5800, 600 bales Khanpur at Rs5800, 200 bales Khanewal at Rs54800, 400 bales Alipur at Rs5500, 600 bales, Sarhari at Rs5100, and 400 bales Ghotki at Rs5400.

Pakistan seeks $1.7bn road investment

ISLAMABAD: Pakistan is seeking foreign investors for a $1.7 billion road project, a senior official said, as the South Asian nation looks to public-private partnerships (PPPs) to help fund badly needed infrastructure projects.

Pakistan is embarking on the biggest road-building programme in its history, with Prime Minister Nawaz Sharif putting infrastructure projects at the heart of efforts to expand trade and speed up economic growth.

Officials say road projects worth Rs850bn ($8.1bn) are due to be completed in the next three years, which they expect to boost growth by 1-1.5 percentage points per year.

A consortium of Pakistani banks has raised $1.5bn for several motorway projects and the government is seeking investors for a $1.7bn public-private concession to build and operate a 296-km highway between Hyderabad and Sukkur.

Shahid Ashraf Tarar, chairman of the National Highway Authority, said Pakistan wants to do more public-private deals which do not add to government debt due to a constitutional limit on borrowing.

“We have to find creative investments in road infrastructure,” Tarar told Reuters in Islamabad. “We are trying to make this road infrastructure self-sustainable over a period of time...and not a burden to the government of Pakistan.” Tarar said Chinese investors and a Euro-Asian consortium have expressed interest in the $1.7bn Hyderabad-Sukkur project but the concession will first have to be advertised.

He said public-private projects in Pakistan would see investors build the highway, operate it and make money mostly through tolls, before returning it to the government. The life span of the concession is expected to be 20-30 years.

Pakistan’s economy is growing at the fastest rate in eight years but foreign investors have remained wary about taking the plunge in a nation which has been racked by economic turmoil and Islamist attacks over the past decade.

The economy is also likely to receive a boost from a $46bn China-Pakistan Economic Corridor project, including about $4.5bn towards road infrastructure.

Tarar said local banks investing $1.5bn in PPP projects should intrigue foreign investors.

“If it’s profitable for local banks...that should be a good enough incentive for foreign investors to look at our projects with interest,” he said.

About 95 per cent of freight in Pakistan is moved by roads as the colonial-era rail network has crumbled due to chronic under investment. Roads also account for 90pc of passenger traffic in the country of 190 million people.

US stocks plunge on Brexit, Dow drops 610 points

NEW YORK: US stocks dived Friday after Britain's surprise vote to leave the European Union, joining a global equity rout amid rising uncertainty about the future of Europe.

The Dow Jones Industrial Average slumped 3.4 per cent to 17,400.75. The 610-point drop was the index's biggest single-day point loss in nearly five years.

The broad-based S&P 500 plunged 3.6pc to 2,037.30, while the tech-rich Nasdaq Composite Index sank 4.1pc to 4,707.98.

Although the losses were broad-based in the US, sectors that were especially hard-hit included banking, energy, travel and industrials.

The unexpected British decision also reverberated through other financial markets, slamming the British pound and boosting gold.

Economists expect weaker global growth, and especially a slowdown in Europe, and a higher risk of recession in Britain. Analysts also expect a hit to the US economy, although not as great as in Europe.

“This was really an event that caught most global investors flat-footed,” said Jack Ablin, chief investment officer of BMO Private Bank.

“We're going to see more days like today as the collective wisdom may prove wrong in others cases, too.”

Among large banks, Citigroup plunged 9.4pc and Morgan Stanley 10.2pc. Bank of America, JPMorgan Chase and Goldman Sachs all lost 7.0pc or more. Large US banks have made London their European headquarters and are expected to face costs associated with retooling their operations.

Gold producers were a rare bright spot as investors flocked to the traditional haven of the gold metal, pushing prices sharply higher. Barrick Gold jumped 5.8pc, Newmont Mining 5.1pc and Goldcorp 4.4pc.

Travel, airline and hotel stocks sank, with American Airlines plummeting 10.8pc, Priceline 11.4pc and Marriott International 7.3pc.

Analysts worry that travel could be curtailed due to the political and economic uncertainty surrounding Britain and the EU.

Technology shares suffered, with especially ugly falls for Cisco Systems, down 5.0pc; eBay, 6.9pc; and NXP Semiconductors, 8.3pc. Apple fell 2.8pc and Microsoft 4.0pc.

Petroleum-linked shares tumbled on lower oil prices, with Halliburton losing 4.2pc, ConocoPhillips 5.4pc and Apache 5.7pc.

Friday, 24 June 2016

Tears, fears and a resignation as Britain exits EU

As over 52 per cent of Britons voted on Thursday to leave the European Union on Thursday.

British Prime Minister David Cameron, who had campaigned against the Brexit, announced his resignation on Friday following the 'Leave' vote even as he promised to try to "steady the ship" before he formally steps down in October.

Following the vote, the Pound sterling crashed to a 31-year low as the KSE-100 index fell 2 per cent on the back of volatility in international currency markets.

The UK now has two years to negotiate terms of exit from the bloc.