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Asian Development Blog: Urgent Climate Action Needed in Asia and the Pacific

These charts illustrate that despite the broader adoption of disaster risk reduction strategies, escalating greenhouse gas emissions and intensified disaster impacts underscore the urgent need for more robust climate action and support across the region.




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Asian Development Blog: Three Ways Capital Markets Can Accelerate Climate Finance in Asia and the Pacific

Asia and the Pacific is central to global climate change efforts, but robust capital markets are needed to mobilize private climate finance. Sustainable finance frameworks, transition finance, and carbon markets can build deeper markets that empower climate action.





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Colorado voters reject Proposition 127 ban on hunting of mountain lions, bobcats

Coloradans have rejected a proposed ban on mountain lion and bobcat hunting -- a hit for wildlife advocates who have worked to outlaw or change the practice for years.





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Trump on Day 1: Begin deportation push, pardon Jan. 6 rioters and make his criminal cases vanish

Donald Trump has said he wouldn’t be a dictator — “except for Day 1.” According to his own statements, he’s got a lot to do on that first day in the White House.







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Denver Sen. Chris Hansen takes job in Durango but is mum on timing to resign his seat

Hansen was comfortably reelected to the state Senate last week, winning 84% of the vote.





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Morrison police chief Bill Vinelli on leave amid investigation

“While the investigation takes place, the town will refrain from any additional comment on this matter," according to a press release.




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People's Republic of China's Competitive Threat to Latin America: An Analysis for 1990-2002

How have Latin American exporters been affected by the rapid increase in the PRC's exports to the USA and other large markets? Are PRC and Latin American exports complementary or competitive with each other?



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Does Exporting Raise Productivity? Evidence from Korean Microdata

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Integrated Financial Supervision: An Institutional Perspective for the Philippines

Philippine institutions and governance structures must be strengthened as part of any effort to reform the country's financial supervisory structure.



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Policies for Private Sector Development in Indonesia

This paper surveys the evolution of policy on private sector development in Indonesia post-independence.



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Dealing with Dollarization: What Options for the Transitional Economies of Southeast Asia?

What should the transitional economies of Southeast Asia do, if anything, to address their multiple currency situations?



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Number of Children and Their Education in Philippine Households

This paper examines the impact of family size on children's education in the Philippines.



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Dollarization and the Multiple Currency Phenomenon in Lao PDR: Costs, Benefits and Policy Options

This paper examines the costs and benefits of the multiple currency phenomenon in Lao PDR and considers options in terms of policy response.



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Prospects of India–Bangladesh Economic Cooperation: Implications for South Asian Regional Cooperation

Bangladesh and India should pursue bilateral economic cooperation to enhance South Asian regional cooperation.



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Policy Environment and Regulatory Reforms for Private and Foreign Investment in Developing Countries: A Case of the Indian Power Sector

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What is Special about Enterprise Performance in North-East People's Republic of China?

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Corporate Governance in the Republic of Korea and Its Implications for Firm Performance

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Infrastructure Challenges in South Asia: The Role of Public-Private Partnerships

South Asian private sector participation in infrastructure development is examined, and recommendations are made for future development.



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Economic and Social Development in the People's Republic of China's North-East Region: a Comparative Study

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India asks states to consider setting up nuclear power plants, list power utilities

India’s federal power minister on Tuesday asked the states that are away from coal resources to consider setting up nuclear-based power plants, besides identifying and listing the power utilities to meet investments to support growing power demand.

The Indian government in its federal budget this year had proposed to partner with private players to develop small nuclear reactors to increase the amount of electricity from sources that do not produce carbon dioxide emissions.

States should consider setting up nuclear power plants at the sites where coal-based thermal power plants have completed their life, Manohar Lal, the country’s power minister, told states as per a government statement.

India’s stringent nuclear compensation laws have hampered talks with foreign power plant builders such as General Electric GE.N and Westinghouse.

The country, which currently has about 8 gigawatts of nuclear capacity, aims to increase it to 20 GW by 2032.

The minister also asked the states to identify and list their power utilities in the country’s stock exchange to meet increasing investment demand in the power sector as well as improve the transmission system to add more renewable capacity.

India has pledged to achieve a net zero carbon emission target by 2070 and has a target of 500 GW of renewable energy by 2030.




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Arrested facilitator of 2023 Peshawar Police Lines blast was ‘our own policeman’: KP IG

A suspect who was allegedly involved in the 2023 blast at Peshawar Police Lines mosque, that claimed 84 lives, was arrested a day earlier and has been identified as police constable Muhammad Wali, the Khyber Pakhtunkhwa Inspector General of Police (IG) Akhtar Hayat Khan Gandapur revealed in a press briefing on Tuesday.

On Jan 30, 2023, a powerful explosion ripped through a mosque in Peshawar’s Red Zone area where between 300 and 400 people — mostly police officers — had gathered for prayers.

The banned Tehreek-i-Taliban Pakistan (TTP) had claimed responsibility for the attack. It later distanced itself from the blast but sources earlier indicated that it might have been the handiwork of some local faction of the outlawed group.

Addressing the press conference in Peshawar today, IG Gandapur said the “remaining missing link” was related to who had facilitated Qari, the alleged suicide bomber.

“As a result of that effort, […] we arrested this person along with two suicide jackets from near Jameel Chowk on Peshawar’s Ring Road on 11/11, meaning yesterday,” the IG stated, referring to the facilitator.

“Based on the interrogation, it was deduced that the facilitator was our own policeman,” who he identified as Muhammad Wali.

“The suspect operated in line with the order of the banned organisation Jamaatul Ahrar and has received Rs200,000 through the hundi-hawala system,” KP IG said, adding that the policeman also received Rs40,000 to Rs50,000 from the banned group per month.

“He received Rs200,000 which cost the lives of hundreds of people who were martyred. He sold his [own] brothers for this,” the IG added.

The top cop further revealed that the suspect dropped off the suicide bomber at the Pir Zakori bridge.

“After the blast occurred, he contacted his handler named Junaid and informed him about the success of the operation via Telegram,” he stated.

While the police already knew that Jamaatul Ahrar was involved in the blast, the suspect was the “missing link” who acted as a local facilitator.

The police inspector general said that Muhammad Wali was also involved in other incidents.

In Feb 2024, the suspect handed a pistol to a person from Jamaatul Ahrar named Saifullah in Lahore to target a member of the Ahmadiyya community, the KP IG said.

He targeted a priest at Peshawar’s Jameel Chowk in Jan 2022, he added.

According to Gandapur, social media played a key role in such incidents, adding that “Fitna al Khawarij and other extremist organisations use social media to brainwash and radicalise people”.

In July, the government, through an official notification, designated the TTP as Fitna al Khawarij, while mandating all institutions to use the term khariji (outcast) when referring to the perpetrators of terrorist attacks on Pakistan.

Then-KP IG Moazzam Jah Ansari had said in February last year that the suicide bomber was “clad in a police uniform”. He had said that technical evidence and information collected suggested that the blast was the work of TTP’s Jamaatul Ahrar faction.

In March 2023, the KP Counter-Terrorism Department (CTD) said the mastermind and the handler of the suicide bomber had been traced, stating that both of them were Afghan nationals.

Then-CTD chief Shaukat Abbas said the suicide bomber was identified only by his alias “Qari” and his handler was identified as Ghaffar aka Salma. He had further confirmed that the attack was carried out by Jamaatul Ahrar.




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Nations to submit boosted climate plans at COP29: What’s at stake?

Nations have begun setting carbon-cutting targets for the decade ahead, and how ambitious these pledges are could make or break global efforts to avoid dangerous levels of climate change.

Nearly 200 countries are supposed to publish updated climate plans by early February, but so far only three have done so.

On Wednesday, the UK became the latest, announcing during the COP29 climate summit in Azerbaijan that it would raise its target to cut greenhouse gas emissions.

All eyes will be on other big polluters like China, India, and the United States, though future US climate action is unclear following Donald Trump’s election.

Why do they matter?

The world has agreed to try and limit global warming to 1.5 degrees Celsius above pre-industrial levels, but is nowhere near on track.

Above this threshold, scientists say humanity risks disastrous consequences from volatile weather to major ecological “tipping points” at land and sea.

Last month, the United Nations warned that even if all existing plans are implemented in full, temperatures would rise 2.6°C by the century’s end, a catastrophic outcome.

The UN says the next round of climate plans must show a “quantum leap” in ambition to avert the worst.

The G20 — which accounts for 77 per cent of total greenhouse gas emissions — is under particular pressure to step up.

Early movers

Just before COP29 opened in Azerbaijan, the United Arab Emirates announced a 47pc reduction in emissions by 2035 compared with 2019 in its updated climate plan.

Observers said the roadmap failed to account for exported emissions —including those from its sales of crude oil abroad.

Next year’s UN climate host, Brazil, has partly unveiled its plan, increasing its emissions reduction target from a 59pc cut by 2035, from 2005 levels, to a 67pc reduction.

It is expected to unveil a more complete plan during COP29.

Plans from other major emitters, like the European Union and China, are not expected until next year.

And the current US government could soon outline Washington’s new pledge, despite questions over Trump following through once in office.

David Waskow, of the World Resources Institute, said it would help guide American cities, states and businesses wishing to continue climate action under Trump.

“It also sends an important signal internationally, a set of benchmarks for what the US ought to do,” he added.

What do countries need to do?

By signing the Paris accord, nearly 200 nations agreed to halt rising temperatures “well below 2°C” and strive for the safer goal of 1.5°C.

But it did not prescribe how to get there.

The deal left it up to countries to voluntarily chart their own plans and targets, known as Nationally Determined Contributions (NDCs).

These include emission reduction targets and measures to achieve them, such as rolling out renewable energy, electrifying transport, and ending deforestation.

There is no set template for countries to follow but richer countries —historically the largest emitters — have a responsibility to pledge the deepest emission cuts.

The plans must be reviewed every five years, with each update supposed to be more ambitious than the last. This time around countries are expected to improve their 2030 targets and outline economy-wide action they will take to 2035.

What’s the aim?

An agreement at last year’s COP28 climate summit “encouraged” countries to come forward with plans aligned with halting warming to 1.5°C.

To have a hope of meeting that goal, emissions must be slashed 42pc by 2030 and 57pc by 2035, the UN’s Environment Programme said last month.

Currently, however, emissions are continuing to rise.

Keeping 1.5°C on track would require a collective effort “only ever seen following a global conflict”, it added.

Without pulling together “on a scale and pace never seen before… the 1.5°C goal will soon be dead,” said UNEP executive director Inger Andersen.

The big moment for assessing progress towards the 1.5°C goal comes at a crunch COP30 climate summit in Brazil next year.

What about fossil fuels?

Scientists and the International Energy Agency have said that developing new fossil fuel projects is incompatible with halting warming to 1.5°C.

But many fossil fuel-producing countries argue that new oil and gas projects will be needed as the world transitions to net zero emissions.

Countries are under pressure to outline in their updated plans how they intend to reduce their reliance on fossil fuels, something all nations agreed on at last year’s COP.


Header image: This picture taken on November 12 shows a wind turbine at the lignite-fired power station operated by German energy giant RWE near Neurath, western Germany. — AFP




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Debt cannot become acceptable new normal in climate financing: PM Shehbaz

Prime Minister Shehbaz Sharif on Tuesday said that debt cannot become the “acceptable new normal” in climate financing, as he addressed the challenges faced by developing countries within the global climate finance framework.

His statement came during a Climate Finance Round Table Conference organised by Pakistan on the sidelines of the two-day World Leaders Climate Action Summit, also known as COP29, currently being held in Azerbaijan’s capital of Baku.

“We stand at a crucial threshold where global climate finance framework must be redefined to effectively meet the needs of vulnerable nations,” PM Shehbaz said.

He explained that financing in the form of loans increases the debt of developing nations and pushes them towards “mounting debt traps” which he referred to as “death traps”.

He added, “Debt cannot become the acceptable new normal in climate financing which is why we must resume focus on non-debt financing solutions enabling countries to fund climate initiatives.”

“Despite years of promises and commitments, the gaps are growing, leading to aggregate barriers in achieving objectives of the UN Framework Convention on Climate Change (UNFCCC).”

PM Shehbaz called climate financing an “urgent need of the hour”, stating that developing countries need to deliver Nationally Determined Contributions (NDCs) and “need an estimated $6.8 trillion by 2030 to implement less than half of their current NDCs.”

The prime minister further urged donor countries to “fulfil their commitment” which is 4.7 per cent of their gross national product (GNP) and capitalise on existing climate funds.

“One such commitment is a $100bn annual climate pledge established a decade ago at COP15 [which] is now reported by OECD to have reached only $160bn,” he said.

Prime Minister Shehbaz Sharif, flanked by Turkish President Tayyip Erdogan and Britain’s Prime Minister Keir Starmer, attends the Opening Ceremony of the United Nations climate change conference COP29 in Baku, Azerbaijan on Nov 12, 2024. — Reuters

PM Shehbaz said that Pakistan can relate to the “agony and pain of other vulnerable countries”, highlighting how the country faced two devastating floods.

“In 2022, one-third of Pakistan was under water and the country had to repurpose all development and climate funds for financing basic relief and humanitarian efforts,” he said.

Pakistan is ranked among the top 10 most climate-vulnerable countries, according to the Global Climate Risk Index 2021. It has faced increasingly frequent and severe weather events, such as unprecedented floods, intense monsoon rains, devastating heat waves, rapid glacial melting and glacial lake outburst floods.

Pakistan witnessed devastating floods during the 2022 monsoon season, induced by climate change, resulting in the loss of at least 1,700 lives.

With 33 million people affected and swathes of agricultural land washed away, the damage incurred losses worth $30 billion, according to government estimates.

In June 2024, a heat wave brought record-high temperatures, severely impacting public health and agriculture.

Participating world leaders and delegates pose for a family photo during the United Nations Climate Change Conference (COP29) in Baku on Nov 12, 2024. — AFP

While emphasising transparency and coordination in financial commitments made to developing countries, he stated that Pakistan alongside other developing countries, calls for stronger more equitable climate finance mechanisms under the UNFCCC.

He reiterated the pertinent need for reform of international financial architecture saying that “now is the time to build up on the momentum for international financial reforms” so that no nation is left behind in the global response to climate change.

PM to highlight ‘balanced and ambitious’ climate action

According to the Foreign Office, several high-level events and roundtable discussions hosted by Pakistan will also take place at the Pakistan Pavilion during COP29.

It added that at COP29, Pakistan will call for “balanced and ambitious progress on all issues such as loss and damage, adaptation, mitigation and means of implementation”.

“It will seek predictable financing to address developing countries’ climate goals. Pakistan will also underscore the historical responsibility and the principle of Equity and Common but Differentiated Responsibility and call on developed nations to undertake deeper emission cuts.”

PM Shehbaz was warmly received by Azerbaijan President Ilham Aliyev and UN Secretary-General António Guterres upon his arrival at the summit venue today, state-run Radio Pakistan reported.

PM Shehbaz Sharif is received by Azerbaijan President Ilham Aliyev and UN Secretary-General António Guterres as he arrives at the venue to attend COP29 in Baku on November 12. — Radio Pakistan

The first day of the Climate Action Summit will feature statements from various heads of states, beginning from 3pm Pakistan time.

Speakers include the United Kingdom’s PM Keir Starmer, Saudi Arabia’s Crown Prince Mohammed bin Salman, Turkiye President Recep Tayyip Erdoğan and Ukraine President Volodymyr Zelenskyy.

Among those scheduled to address the high-level meeting tomorrow, besides PM Shehbaz, are Bangladesh leader Muhammad Yunus and Russia’s PM Mikhail Mishustin.

PM Shehbaz is listed as the 37th speaker out of 47 leaders during the session scheduled from 10am to 6pm (Pakistan time).

The prime minister will also participate in a high-level event ‘Glaciers 2025: Actions for Glaciers’ organised by Tajikistan President Emomali Rahmon on the protection of glaciers.

PM Shehbaz will also hold separate meetings with the prime ministers of Denmark and the Czech Republic, who are also attending COP-29, Radio Pakistan stated.

PM meets world leaders

On the sidelines of COP29, PM Shehbaz interacted with UAE President Sheikh Mohammed bin Zayed Al Nahyan and discussed cooperation on climate change and matters of mutual interest, Radio Pakistan reported.

The premier also met with PM Starmer, where the two discussed enhancing Pakistan-UK cooperation.

He also met with Turkish President Recep Tayyip Erdogan and his wife Emine Erdogan, where they discussed environmental pollution as well as matters of mutual interest between the two friendly nations, the report added.

In his interactions with Nepal’s President Ramchandra Paudel and Bangladesh’s Yunus, PM Shehbaz discussed growing temperatures, the threat of rising sea levels, and forest conservation in South Asia.

Kazakhstan President Kassym-Jomart Tokayev and PM Shehbaz explored strengthening bilateral relations as well as expanding regional connectivity.

In his meetings with Uzbekistan President Shavkat Mirziyoyev and Tajikistan’s Rahmon, the leaders spoke about the conservation of glaciers and water resources in Central Asian countries and Pakistan.

They also exchanged views on expanding communication links among Pakistan, Tajikistan and Uzbekistan, Radio Pakistan highlighted.

World leaders meet for climate talks, but big names missing

Dozens of world leaders convene in Azerbaijan for COP29 but many big names are skipping the UN climate talks where the impact of Donald Trump’s election victory is keenly felt.

UK’s Starmer will unveil an “ambitious” update to the UK’s climate goals later today, and said he wanted his country “to show leadership on the climate challenge.”

Joe Biden, Xi Jinping, Narendra Modi and Emmanuel Macron are among G20 leaders missing the event, where uncertainty over future US unity on climate action hung over the opening day.

“It’s not an ideal situation,” acknowledged Steven Guilbeault, Canada’s environment minister. “But in 30 years of COP, it’s not the first time that we’ve faced obstacles,” he told AFP.

“Certainly, everything is still possible.”

Washington’s top climate envoy John Podesta is seeking to reassure countries in Baku that Trump’s re-election will not end US efforts on global warming, even if the issue will be “on the back burner”.

But despite calls for global cooperation, the opening day got off to a rocky start, with feuds over the official agenda delaying by hours the start of formal proceedings in the stadium venue near the Caspian Sea.

“This will be a tough COP,” said Fernanda Carvalho, global climate and energy policy lead at WWF.

“Countries are divided. There is a lack of trust,” she told AFP, and divisions over climate finance “will be reflected in every room of those negotiations.”




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PTI files curative review with SC in ‘bat’ symbol case

ISLAMABAD: As a last resort after losing the election symbol, PTI on Tuesday filed a curative petition with the Supreme Court, seeking to overturn the Jan 13 and Oct 21 rulings that supported the Election Commission of Pakistan’s decision to deny the party its ‘bat’ symbol.

The curative petition is a final remedy that allows the SC to reconsider a dismissed review petition.

The 32-page petition, moved by Advocate Ajmal Ghaffar Toor, says the present petition has been necessitated by circumstances during the hearing and therefore based upon the principle of natural justice.

Besides the verdict is per incuriam and not a judgement at all, argued the petition, adding the petition was relying upon the Aug 22 Mubarak Ahmed Sani case in which the Supreme Court had altered its earlier decision.

Judgement was per incuriam, 32-page petition argues

The petition argues that the judgement was per incuriam, meaning it was made in ignorance of the terms of a statute or rule having the force of a statute. A decision made per incuriam can be considered a mistake and may not be binding.

The petition also relied on the Aug 22 Mubarak Ahmed Sani case, where the SC had altered its earlier decision, setting a precedent for revisiting previous judgements.

On Oct 21, the SC headed by former chief justice Qazi Faez Isa rejected PTI’s petition, seeking to revisit Jan 13 verdict in the bat symbol case.

The review petition was dismissed on the grounds that no illegality or material error in the judgement was pointed out by the petitioner.

During the case, the senior counsel Hamid Khan had pleaded before the apex court that he did not want to argue before a bench headed by a person who “harbours bias against PTI”.

It is the case of the petitioner that both judgements of Jan 13 and Oct 21 were void and non-existent in the eyes of law. The petition has raised questions of public importance with respect to fundamental rights and interpretation of the laws relating to the electoral rights of the people who were true sovereigns, by seeking to invite SC’s attention towards two of its own judgments, the curative review says.

On May 26, 2021, PTI had moved a curative review petition before the SC against Justice Isa who had won a case on a review petition. Then the curative review petition was moved against the majority order in favour of Justice Isa.

Later on July 21, 2023, ex-CJP Umar Ata Bandial rejected in chambers PTI’s curative review petition against Justice Isa whereas Justice Syed Mansoor Ali Shah in his additional note stated that a second review or a curative review or whatever given name, was not maintainable under Article 188 since this provision envisages only one-time exercise of this jurisdiction, whether made on a review petition or suo motu in respect of any of its judgments.

Now the fresh curative petition pleads that the SC judgment of Oct 21 was virtually an ex-parte order as no substantive hearing took place in view of the objections raised against former CJP Qazi Faez Isa and therefore it would serve the interest of justice that the judgement was set aside and the review petition was fixed for hearing again.

The curative review argued that both Justice Muhammad Ali Mazhar and Justice Musarrat Hilali, who were members of the bench which heard the review petition then, signed allegedly a blatantly biased orders, dictated by then CJP and therefore they have disqualified themselves from hearing the present petition.

Published in Dawn, November 13th, 2024




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IMF seeks update on revenue system’s digital overhaul

• Holds introductory meeting with finance minister
• Govt pledges to end gas supply to captive power plants by Jan
• Lender’s team to hold joint session with power and petroleum divisions today

ISLAMABAD: The International Monetary Fund (IMF) has sought a detailed, output-based update on Pakistan’s digitalisation plans for its revenue system, including the use of artificial intelligence to expand the tax base and increase collections.

On the energy side, the country has pledged to halt gas supply to captive power plants (CPPs) by January 2025, redirecting them to the national grid despite a strong pushback from influential rent-seeking industrialists. The IMF has firmly rejected any amendments to this programme benchmark.

The visiting IMF team, led by Pakistan’s mission chief Nathan Porter, held an introductory meeting on Tuesday with Finance Minister Muhammad Aurangzeb. Minister of State for Revenue Ali Pervez Malik, State Bank Governor Jameel Ahmad and Federal Board of Revenue (FBR) Chairman Rashid Mehmood Langrial were also present.

The mission is also holding separate technical sessions with all the stakeholders, including the FBR, power and petroleum divisions and the energy sector regulatory authorities. In all these engagements, the mission appeared to have not expressed its mind so far, except from raising exploratory questions, participants told Dawn.

It is not yet clear if the dialogue would lead to policy-level discussions that had been a critical part of IMF programmes’ quarterly reviews.

The current $7 billion Extended Fund Facility (EFF), however, has been designed in a manner that the IMF and Pakistan authorities should hold biannual review meetings for the disbursement of about $1bn instalments during each cycle.

The first formal review has to take place based on the end-December performance for Pakistan to qualify for disbursement for a second instalment of over $1bn by March 15, 2025.

Officials said the IMF mission has called for detailed explanations on the digitalisation of FBR’s processes for revenue collection, application of artificial intelligence for identifying and tracing tax evaders and their taxable incomes and businesses and involvement of specialised expert firms. They have also sought a complete update on the track-and-trace system.

In initial meetings, the FBR attributed recent revenue shortfalls — particularly in the first month of the second quarter — to the declining inflation.

The power sector’s performance appears to be within agreed limits concerning circular debt and current revenues.

Circular debt rose by about Rs70bn, below earlier estimates of Rs240-250bn. A circular debt management plan was approved only last week by the Economic Coordination Committee (ECC), led by the finance minister.

Sources said the government had been going back and forth over the disconnection of gas supply to inefficient captive power plants, belonging mostly to the textile sector, to utilise surplus capacity in the national power grid.

The industrialists have, however, now mustered support from gas companies. Some stakeholders are now pushing for the supply of imported LNG to CPPs at a weighted average cost of local and imported molecules on the premise that electricity connections were not available or were insufficient in certain areas.

The IMF mission is scheduled to have a joint session with the power and petroleum divisions on Wednesday (today) to discuss their interrelated issues, including circular debt, planned tariff adjustments, loss reduction programmes and recoveries.

Published in Dawn, November 13th, 2024




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Minimum retail price at import stage to make ‘cuppa’ costlier

KARACHI: The Federal Board of Revenue’s (FBR) decision to fix the minimum retail price (MRP) of tea at Rs1,200 per kg for levying sales tax would make the commodity more expensive, warned traders on Tuesday.

Pakistan Tea Association (PTA) Chairman Mohammad Altaf said the MRP at the import stage would have an adverse impact of Rs150-300 per kg on imported tea prices.

The flat MRP also ignores global tea prices hovering between 0.50 cents to over $3 per kg. Tea is imported in different packaging, with bulk shipments typically weighing more than 5kgs and around/approximately 80kgs. An 18 per cent general sales tax is already charged based on the imported tea.

He said before fixing the MRP for sales tax purposes, it is crucial to consider that the definition of “manufacturer” in Section 2(16) of the Sales Tax Act 1990, includes activities such as blending, mixing, processing, and packaging, as clarified in Circular No. 3(11) ST-L&P/2013-94433-R dated July 17, 2019. Based on this, tea imported for these processes qualifies as “raw material”.

Tea sellers warn FBR move will incentivise arrival of low-quality product via illegal channels

“According to judicial interpretations (e.g., CTO v. Rajasthan Taxchem Ltd., 2007) and definitions in Advanced Law Lexicon, “raw material” includes ingredients necessary for manufacturing. Tea used in blending and packaging clearly falls under this category, he added.

Accordingly, sales tax should be based on the import value, as per Subsection 46(f) of Section 2 of the Sales Tax Act, 1990, rather than the minimum retail price, Altaf said.

Tea retail prices vary significantly due to numerous factors, including the company, method of sale (open or packaged), product quality, and regional differences. The PTA chief said that the flat MRP rate per kg also does not reflect the prices charged by most traders, manufacturers, and sellers.

The imposition of a flat rate per kg would have severe negative consequences for a large portion of the tea trade, which may result in reduced business activity and ultimately lead to a loss of revenue for the national exchequer via misusing several exemptions.

Two-thirds of Pakista­nis purchase tea at Rs700-950 per kg, reflecting socio-economic and regional price variations.

He said that MRP cannot be applied at the import stage as the tea has to follow various value-addition procedures before it is made shelf-ready. “This MRP disrupts the supply chain and eradicates the role of wholesalers and distributors who play a vital role in the business, while MRP at the import stage also eradicates the basic right of commercial imports,” the PTA chief observed.

Tea is a part of our daily diet, a staple food item, not a drink.

Most people in rural and urban areas consume tea as per their earnings. Further fixing of MRP will incentivise unscrupulous elements to exploit the situation, and thus, import of low-priced teas will find its way through illegal channels, Altaf feared.

Published in Dawn, November 13th, 2024




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