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Bulls return to PSX after IMF greenlights govt’s circular debt plan

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The bulls returned to the Pakistan Stock Exchange on Wednesday after the International Monetary Fund (IMF) approved the government’s plans to reduce the circular debt balance.

The benchmark KSE-100 Index closed the day on a positive note with gain of 797.78 points or 1.68% to settle at 48,227.60.

Bulls return to PSX after IMF greenlights govts circular debt plan

Arif Habib Limited’s Head of Research Tahir Abbas stated that for the last two days, bears were dominating the market as there was “selling pressure”.

Abbas said that the “selling pressure” was there as the investors were busy in profit taking and there was uncertainty with regard to the caretaker prime minister and who will take over from Finance Minister Ishaq Dar in the interim setup.

“Apart from that, there were question marks on circular debt due to which we saw selling in two days. This has reversed today and the market saw positive momentum,” he added.

Another reason for the bulls’ domination of the marker as per the expert was the finalisation of a caretaker setup. “Apart from that there was news that the IMF has given the go-ahead on the circular debt resolution due to which we saw across-the-board positive momentum.”

On the other hand, capital market expert Saad Ali said that the market rejuvenated after yesterday’s correction following the new development related to the energy sector.

“There was news that the IMF has approved the government’s plans to reduce the circular debt balance in the gas chain through the dividends of state-owned E&Ps,” said Ali.

A day earlier, the Cabinet Committee on Energy (CCOE) approved the revised Circular Debt Management Plan (CDMP).

It has been envisaged under the revised the CDMP that the quarterly tariff adjustments and fuel adjustments would be charged from consumers in a timely manner after raising the baseline tariff. There would be no untargeted subsidy for any sector.

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Irfan Siddiqui meets with the PM and informs him about the Senate performance of the parliamentary party.

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The head of the Senate’s Foreign Affairs Standing Committee and the PML-N’s parliamentary leader paid Prime Minister Muhammad Shehbaz Sharif a visit in Islamabad.

Senator Irfan Siddiqui gave the Prime Minister an update on the Parliamentary Party’s Senate performance.

Additionally, Senator Irfan Siddiqui gave the Prime Minister an update on the Senate Standing Committee on Foreign Affairs’ performance.

He complimented the Prime Minister on his outstanding efforts to bring Pakistan’s economy back on track and meet its economic objectives.

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SIFC Increases Direct Foreign Investment: Investment in the Energy Sector Rises by 120%

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The Special Investment Facilitation Council is intended to help Pakistan’s energy sector attract $585.6 million in direct foreign investment in 2024–2025. The amount invested at the same time previous year was $266.3 million.

This is a notable 120% rise, mostly due to investments in gas exploration, oil, and power. Such expansion indicates heightened investor confidence and emphasizes the development potential in important areas.

The State Bank reports that foreign investment in other vital industries has increased by 48% to $771 million.

This advancement is a blatant testament to SIFC’s efficient investment procedure and quick project execution.

The purpose of the Special Investment Facilitation Council is to establish Pakistan as an investment hub by aggressively promoting regional trade and investment in the energy sector and other critical industries.

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Discos report losses of Rs239 billion.

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When compared to the same period last year, the data indicates that discos have decreased their losses in the first quarter of the current fiscal year.

The distribution businesses recorded losses of Rs239 billion in the first three months of the current fiscal year, a substantial decrease from the Rs308 billion losses sustained during the same period the previous year.

Additionally, the distribution businesses’ rate of recovery has improved. It has increased to 91% in the first quarter of this year from 84% in the same period last year, indicating success in revenue collection.

Regarding circular debt, the Power division observed a notable change. Last year, between July and October, the circular debt grew by Rs301 billion. Nonetheless, this year’s first four months saw a relatively modest increase in circular debt, totaling about Rs11 billion.

These enhancements show promising developments in the electricity sector’s financial health in Pakistan, where initiatives are being made to accelerate recovery rates and slow the expansion of circular debt.

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