Business

An argument in favor of coffee in Pakistan

Published

4 months ago

Farwa

In Pakistan, coffee is becoming more and more popular, especially among younger people, who drink it hot instead of other drinks. Its high price is partly due to the high tariffs on coffee, though, which makes the expansion of the national coffee market difficult.

Colleges, universities, and workplaces are full of young people who clearly enjoy coffee. This suggests that as the number of young people increases, their tastes will change.

The Pakistani coffee lover and specialist in advertising, Faizan Tariq, says he wishes coffee was as cheap as tea. He questions why coffee prices are not more competitive, similar to those of tea, given its appeal as a hot beverage for working late into the evening.

When the semester system started in college, Punjab University student Amna Tariq resorted to coffee. She views coffee as a lifeline during exam season and depends on it to keep her energized throughout strenuous university responsibilities. Still, she wishes coffee, like tea, was more reasonably priced on weekdays.

It is estimated that by 2025, the global coffee market would be worth $85 billion, with 2.25 billion cups consumed daily. Pakistan must assess and reorganize its tax system as a developing coffee market. After customs, additional customs, and regulatory duties, the total duty on finished coffee goods is currently 53%, while bulk imports are subject to a tariff of 28%. But just thirteen percent of the tariff is applied to tea.

High duties not only prevent the coffee industry from expanding, but they also make it difficult for legitimate companies to make investments, which encourages the formation of the black market. Legal coffee-making enterprises cannot match the cost of foreign coffee brands that are smuggled because they have to pay taxes and duties.

SRO 237, which was issued in 2019, also states that products must have a minimum shelf life of 66 percent at the time of import, ingredient labeling in both English and Urdu, and halal certification from recognized authorities in addition to meeting certain logo and labeling specifications. All of these requirements are violated in this scenario. Provincial and federal governments are in charge of ensuring conformity at the retail level and during importation, respectively.

A chance exists in Pakistan to localize, assemble, manufacture, and brand coffee with the possibility to export it, given the rising public consumption of the beverage. It is worth noting that a prominent global multinational coffee producer is already present in Pakistan and could be well-positioned to take advantage of this favorable circumstance. A major factor in fostering an atmosphere that supports these kinds of initiatives is the government.

Also, Pakistan can grow coffee; in fact, the Pothohar region of the country has a climate that is ideal for coffee growth. In addition to creating job opportunities, this might unlock economic potential and diversify Pakistan’s agriculture value chain. It is necessary to streamline the bulk coffee duty structure in order to assist this, as doing so will draw in foreign investment, promote value chain development, and encourage innovation in the coffee industry.

The coffee market in Pakistan is expanding, but in order to fully realize the industry’s potential, it is imperative to reform the duty structure, encourage localization, and strengthen coffee cultivation.

Business

Pakistani stock market close to a ten-year high: Bloomberg

Published

15 hours ago

Farwa

Pakistani stocks ended Thursday close to their all-time high as optimism was raised by strong inflows of foreign capital and strengthening macroeconomic data, according to Bloomberg.

The benchmark KSE-100 index of the Pakistan Stock Exchange reached a new high earlier in the day and gained 1.1% to settle just short of the previous record of 81,865.10.

The measure has increased by more than 30% this year, according to data collated by Bloomberg, helped by foreign investors’ net purchases of $87 million in local shares, the greatest amount since 2014.

Because of a stronger economic outlook and a significant initial loan agreement with the International Monetary Fund in July, Pakistan’s stock market has performed among the best in the world this year.

The country’s current account balance has improved recently, and the central bank has cut interest rates in response to a slowdown in inflation.

Nevertheless, moving forward carries some risk. In July, FTSE Russell downgraded Pakistan from secondary emerging market to frontier market status. The choice will take effect on September 23.

Business

Report: Solar is expected to set new records this year.

Published

2 days ago

Farwa

In 2023, there was an expected 87% increase in growth. This year’s increase is 29% over the previous one, according to the research.

The cheapest source of electricity globally is solar power, and as such, it is expanding quicker than many anticipated, according to Euan Graham, an Ember electricity data analyst.

Ember estimates demonstrate the rapid growth of solar energy: in 2024 alone, new solar capacity will surpass the 540 GW of additional coal power added globally since 2010.

Expected to add 334 GW, or 56 percent of the global total in 2024, China continues to lead the globe in this industry.

According to the survey, it is followed by the US, India, Germany, and Brazil. These five nations will account for 75% of the new solar capacity in 2024.

According to the research, maintaining the sector’s growth required grid capacity and battery storage.

“Providing enough grid capacity and developing battery storage is critical for handling electricity distribution and supporting solar outside of peak sunlight hours as solar becomes more inexpensive and accessible,” the statement stated.

“Solar power might continue to surpass forecasts for the remainder of the decade if these issues are resolved and development is sustained.”

Business

The PSX has resumed operations, achieving a gain of 970 points.

Published

2 days ago

Farwa

The optimistic close at the PSX was propelled by rumors preceding the International Monetary Fund (IMF) executive board meeting on September 25, at which the approval of a $7 billion Extended Fund Facility (EFF) is expected, stated Ahsan Mehanti of Arif Habib Commodities.

Strong economic indicators, such as increasing remittances, escalating exports, and a declining trade deficit, further bolstered investor confidence. Furthermore, the Asian Development Bank’s (ADB) commitment to a $2 billion yearly concessional loan until 2027, along with a robust rupee, significantly contributed to the market’s favorable performance, he stated.

Widespread purchasing at the PSX was noted among blue-chip stocks, with major players like Mari Petroleum (MARI), Engro Fertilizers (EFERT), United Bank Limited (UBL), Meezan Bank Limited (MEBL), and Fauji Fertilizer Company (FFC) recording substantial increases. According to Topline Securities, these stocks collectively resulted in a significant 682-point increase in the index.

Pioneer Cement Limited (PIOC) announced its fiscal year 2024 results, revealing a profits per share (EPS) of Rs 22.79 and a cash dividend of Rs 10 per share. This announcement contributed to the favorable sentiment in the market.

Trading volume surpassed 400.2 million shares, resulting in a total turnover of Rs15.9 billion. Worldcall Telecom Limited (WTL) topped the volume chart, transacting more than 32.2 million shares.

The Large Scale Manufacturing Index (LSMI) demonstrated a year-on-year (YoY) gain of 2.4% in July 2024. This expansion was propelled by multiple critical areas.

Tobacco experienced a significant increase of 90.2%, establishing it as the foremost contributor to the LSMI growth. Conversely, the automotive sector witnessed a substantial increase of 72.0%, indicating robust demand and output.

The transport equipment category experienced an 11.7% increase, signifying robust growth in the manufacturing of transport-related machinery and equipment. The other manufacturing sector experienced a gain of 10.7%, positively impacting the overall LSMI.

Nevertheless, not all industries exhibited strong performance. The leading decliner was the fabricated metal sector, which experienced an 18.4% decrease, signifying a contraction in metal product manufacturing. The electrical equipment industry experienced a substantial decline of 19.4%, indicative of reduced output levels.

In July 2024, the LSMI decreased by 2.1% on a month-on-month (MoM) basis. This fall signifies a minor contraction in manufacturing operations relative to the preceding month, although the favorable year-on-year growth.