Day: September 23, 2021

Federal Minister for Industries and Production Makhdum Khusro Bakhtiar has directed the Small and Medium Enterprises Development Authority (SMEDA) and provincial departments concerned to finalize the new SME policy in the light of Prime Minister Imran Khan’s vision to promote cross-sectoral small businesses across the country.

Speaking at a meeting of the National Coordination Committee, held with Mr. Bakhtiar in the chair on Thursday to deliberate on the framework of the proposed National SME policy, he said the government was working on a comprehensive policy for cross-sectoral development of SMEs, particularly export-oriented businesses in the country.

The Committee Chairman was briefed on the salient features of the proposed policy framework, entailing financial incentives (enhancing SMEs access to collateral-free lending), fiscal incentives (simplified taxation regime for SMEs), SME registration portal, formation of common facility centers and warehouses, and guillotine/regulatory simplification for SMEs countrywide.

The Minister said the development of SMEs was imperative for sustainable economic growth in the country. He highlighted that the government was focusing on enhancing credit-financing to tax filer SMEs as well as increasing credit limit to collateral asset-owning enterprises for expansion of existing businesses. He said the new policy would focus on the enlargement of bandwidth of micro-financing and the venture investment for SMEs with the help of international donors.

Mr. Bakhtiar noted that the new SME policy would outline incentives for women-oriented businesses, thus reducing the gender gap in financial inclusion by mainstreaming the role of women in the economy. He said his Ministry would allot land to SMEs on a rental-lease model in the Special Economic Zones. He called for a specialized lending scheme for the garment sector and IT-enabled services within the purview of the SME policy.

Mr. Jawwad Raffique Malik, Secretary Industries and Production, along with senior officials of the Ministry, and Mr. Hashim Raza, CEO SMEDA, were also present in the meeting. Chief Secretary Punjab Mr. Kamran Afzal, representatives of the State Bank of Pakistan, Board of Investment, Ministry of Finance, and provincial departments also participated in the meeting.

Source: Pro Pakistani

Karachi’s power distribution company, K-Electric (KE), has requested the National Electric Power Regulatory Authority (NEPRA) to increase the price of electricity by Rs. 0.97 per unit for the month of August.

A notification revealed that KE has sought Rs. 1.76 billion for monthly fuel adjustment. In this regard, the notification says, a hearing to determine the tariff for the month of August will be held on September 29.

The notification by NEPRA explains that two issues have been framed for discussion during the hearing — whether the requested fuel price variation is justified, and whether the KE has followed the merit order while giving dispatch to its power plants as well as power purchase from external sources.

“The calculation for the month of August 2021 is based on CPPA-G’s latest fuel cost determined by NEPRA for the month of July 2021 and it is subject to adjustment based on the determination for August 2021 to be issued by NEPRA,” KE stated in its request to the authority.

Source: Pro Pakistani

The State Bank of Pakistan (SBP) has revised Prudential Regulations (PRs) for Consumer Financing. This targeted step will help moderate the demand growth in the economy, leading to a slower import growth and thus supporting the balance of payments.

The revisions in the PRs effectively prohibit financing for imported vehicles and tighten regulatory requirements for financing of domestically manufactured/assembled vehicles of more than 1000 cc engine capacity and other Consumer Finance facilities like personal loans and credit cards.

Following changes have been made in this regard:

The maximum tenure of auto finance has been reduced from seven (7) to five (5) years

The maximum tenure of a personal loan has been reduced from five (5) to four (4) years

The maximum debt-burden ratio, allowed to a borrower, has been decreased from 50% to 40%

The overall auto financing limits availed by one person from all banks/DFIs, in aggregate, will not exceed Rs3,000,000, at any point in time

The minimum down payment for auto financing has been increased from 15 percent to 30 percent

With an objective to protect the lower-to-middle income category purchases, these new regulations are not applicable to locally manufactured or assembled vehicles of up to 1,000 cc engine capacity. They are also not applicable to locally manufactured electric vehicles to promote the use of clean energy. The financing of these two categories of vehicles will continue to be governed by the previous set of regulations.

Source: Pro Pakistani