A subject of this column quite often is the wheat economy of Pakistan and the mess that has become of it due to the state's intervention. Once again, the support price is being raised to match the ever-declining international prices, but to what end?
Competition pushes you to do better. That's what private sector brings in to the economy. The present government has also been famous for being obsessed with supporting the idea of privatisation. While its recent demeanour has been conflicting with its long-time slogan of privatisation (Read: Disinfecting Discos, Published on July 28, 2016), the federal government has now revealed its plans to privatise LNG-based power plants.
After posting double digit return for six consecutive years, the benchmark KSE-100 index returned 9.84 percent in FY 2015. Global markets this year were marred by decline in oil prices and fears of a slowdown in China.
Engro Foods Limited (PSX: EFOODS) announced its half yearly accounts on Friday, posting decline in its net turnover. Pakistanâ??s dairy sector is witnessing a boom in recent years and multiple new companies like Fauji Foods Limited (Formerly Noon Pakistan Limited), and Dalda Pakistan along with pasteurized-milk players have started to put pressure on EFOODSâ?? margins.
The monetary policy is due this weekend; economic fundamentals are calling for a cautious stance, but the vibes from the market are of 25 bps cut in policy rate to 5.5 percent. In the last policy review, market was expecting a status quo, but the monetary policy committee surprised everyone with an unconventional 25 bps cut. Ironically, the statement was full of concerns of upward inflationary trend.
The National Electric and Power Regulatory Authority (NEPRA) recently took suo motu proceedings for solar and wind tariffs in the country. The proposed levelised tariff for wind power plants is Rs8.606/kWh (USc 8.197/kWh) and the allowed CAPEX cost is $1.82 million per /megawatt.