Business News

Finance Minister Ishaq Dar while giving brief overview
of the previous measures to boost exports announced new
initiatives under which the custom duty on raw-hides and skins
will be reduced to zero; stamping foil used in producing high
value added finished leather will also be exempted from
customs duty.
He said as the rice exporters are facing difficulties in
marketing due to long distances from their potential market,
it is being decided in principle to allow warehousing of rice
outside Pakistan.
For the promotion of housing sector, the Finance
Minister announced that a Risk Sharing Guarantee Scheme would
be launched under which the Government will provide 40 percent
credit guarantee cover to Banks and DFIs for home financing
for up to Rs 1 million, adding, Rs 6 billion have been
allocated for this purpose.
He said Pakistan Infrastructure Bank (PIB) will be
established to provide infrastructure financing for
commercially viable private sector projects. This effort will
be spearheaded by the IFC with a 20% equity of the Government
through PDF, while the remaining share will be provided by the
private sector.
The Bank is expected to assist in introducing innovative
project financing tools such as building domestic
infrastructure bond market and creating contingent financing
products which include credit guarantees, credit default
swaps, foreign currency liquidity facility and refinancing
options, he added.
In order to increase access to financial services for
the vast majority of the people, Ishaq Dar said, a Rs 8
billion fund will be created at the State Bank of Pakistan to
provide loans to low-income segments through microfinance
banks.
He said in order to enable banks to provide financing to
SME sector, the Government is planning to introduce Risk
Mitigation Facility for Small and Medium Enterprises through
Rs 3.5 billion fund to be established in the SBP.
The facility will cater to both Islamic and conventional
banking products, he added.
To cater the requirement of SMEs, the Finance Minister
also announced the establishment of an Innovation Challenge
Fund with Rs 500 million. This fund will be professionally
managed in collaboration with the key technology universities
of Pakistan, he added.
Ishaq Dar while speaking about energy sector said “By
2018 Inshallah 10,000 MW of additional electricity will
become part of the national grid.”
In addition, financial close have taken place for
15,000 MW of electricity generation projects beyond 2018.
In this regard, the government was proposing Rs 401 billion for
power sector development including investment of Rs 317
billion to be undertaken by WAPDA for the next year, he added.
Other than the large hydro power projects, he said, the
government was allocating Rs 38 billion for the development of
water sector.
Key projects such as extension of Right Bank Outfall
drain (RBOD – II), RBOD – I and Kaachi Canal would be given the
largest share in the water sector portfolio, he added.