Economic and Political Weekly 28-07-2019

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World

Politics

·Boris Johnson to put ‘maximum energy’ into role as new British PM

Boris Johnson with his Indian origin ex wife

Boris Johnson promised fellow Conservatives on 23rd July that he would put his “maximum energy” into his new role as prime minister of the United Kingdom, calling on the governing party to pull together to leave the European Union by October 31st. Mr. Johnson, whose victory in a leadership race was announced earlier on Tuesday, was greeted by cheering Conservative MPs, one of whom described the incoming prime minister’s speech as one that built “a very warm feeling,” in the room at a closed meeting of party members.

·  Power flickers across Venezuela after worst blackout since March

Caracas residents woke up on 23rd July with the lights back on after the worst blackout since March knocked out power in half of Venezuela a day earlier, although service remained down in other states and some key oil infrastructure went offline. State Power Company Corpoelec, in a statement on 23rd July said nine states were in the process of recovering service and power had fully returned to the capital Caracas. Tuesday’s blackout left over half of the OPEC nation’s 23 states in the dark.

· Iran releases footage of captured tanker’s crew

 

Iran has released a short video of what it says is the crew of the Stena Impero, the British-flagged tanker that was seized by Iranian forces in the Strait of Hormuz on 19th July. The footage was posted on 22nd July on the website of Iran’s semi-official Fars news agency. In what appear to be staged shots, it shows several crew members in various locations around the tanker. The crew can be seen talking in a meeting room, operating the ship’s systems and cooking in the vessel’s kitchen. A spokesperson for Stena Bulk, the company that operates the tanker said that they could not verify the authenticity or the source of the video. Iran has released a video of what it said was the crew of the UK-flagged tanker Stena Impero. While the vessel was sailing under a UK flag, Stena Bulk is headquartered in Sweden, and the 23 seafarers on board hail from India, Latvia, Philippines and Russia. Now in the gulf UK warships are escorting their ships,

· South Korea accuses Russia of ‘distortion of the facts’ over mid-air confrontation

South Korea has accused Russia of a “distortion of the facts,” amid a deepening diplomatic rift over an alleged violation of airspace. On 23rd July, South Korea claimed a Russian A-50 military aircraft flew over territory claimed by Seoul, saying its fighter jets had fired 360 warning shots at the plane during its two alleged incursions. Russia has denied that its aircraft violated South Korean airspace, but in a statement 24th July morning, Seoul claimed Moscow’s military attache had earlier said the alleged incursion was due to a “mechanical malfunction” and apologized. “If the aircraft followed the originally planned path, this situation wouldn’t have happened. Russia respects international law as well as South Korean law,” the attaché allegedly said, according to the South Koreans. But by 24th July afternoon, Seoul said it had received an official letter from the Kremlin restating that Russia’s military aircraft had not crossed into South Korea’s airspace. “Russia’s claim is not only a distortion of the facts but also a contradiction to the expression of regret and the position that they will make the effort for a precise investigation … which were delivered via diplomatic channels yesterday,” South Korea’s Ministry of Defense said. Until 23rd july, Russia and South Korea had rarely come into conflict in a region known for its territorial disputes and historic animosities. Both Russia and China have said they were holding their “first joint strategic air patrol in northeast Asia” on Tuesday, which Beijing said “strictly abided” by international laws. “This operation was part of the annual cooperation plan between Chinese and Russian militaries and did not target any third party,” Chinese Defense Ministry spokesman Wu Qian said on 24th July.

·  China’s military warns against growing threat from Taiwan ‘separatists’

China has warned against what it describes as a growing threat from “separatists” in Taiwan, and said it would not rule out using force against the self-governed island Beijing regards as part of its territory. In a national defense white paper released 24th July, China took aim at what it considers pro-independence or separatist forces in the far western region of Xinjiang, Tibet and Taiwan, claiming they were a threat to national security and social stability. In particular, the paper accused Taiwan’s democratically-elected government of “pursuing a path of separatism” by pushing for “gradual independence,” warning that China “must and will be reunited.”

·  At least 6 killed, mayor wounded in suicide bombing in Somalia’s capital

The mayor of the Somali capital of Mogadishu was wounded and at least six others killed in a suicide bomb attack on 24th July on a government building, the country’s information minister said. The mayor, Abdirahman Omar Osman, was badly wounded in the blast, Somalia’s Minister of Information Mohamed Abdi Hayir told reporters. Among those killed were two district commissioners and three regional-level directors, he said. In addition to the mayor, five others also were wounded, Hayir said. Terror group Al-Shabaab claimed responsibility for the attack in a statement, saying it targeted United Nations officials who were visiting the government building. Hours before the blast, James Swan, the UN special representative for Somalia and an American diplomat, met with the mayor and his district commissioners in the building but left after his meeting, police and the UN confirmed.

· Europe sweats as another record-breaking heat wave rolls in

Europeans have already been struggling with the heat this summer, but meteorologists warn that it’s going to get even hotter over the next few days. Widespread alerts warning of medium or high temperatures have been issued across many countries in Western, Central and even northeastern Europe. Weather forecasters in the UK say the country will sizzle this week in a heat wave that could set a new record for hottest day. Temperatures will peak on Thursday, when the mercury could reach a sweltering 39 Celsius (102.2 Fahrenheit), according to the UK’s national weather service, the Met Office. The hottest temperature ever recorded in the UK is 38.5 C (101.3 F), recorded in Faversham, south east England, in August 2003, according to the Met Office.

· Hong Kong lawmaker says opponents walking ‘path of not being alive’

A pro-Beijing lawmaker who has become a figure of hate among pro-democracy circles in Hong Kong has issued a direct threat to his opponents after vandals attacked his office and the graves of his parents. “Today, I want to tell you very clearly,” Junius Ho said, in Cantonese in a video posted on Face book late 23rd July. “The paths before you? One is a path of being alive; one is a path of not being alive. You must choose which path to take. Decide soonnding their homes” and that it was normal for him to be in the village, as he lives there and is known to the local community.

  • India denies that Trump was invited to mediate Kashmir conflict after social media firestorm

Indian officials have denied claims made by United States President Donald Trump that he was invited by the Indian government to mediate in the long-running Kashmir conflict, after his comments provoked a social media firestorm in India. Raveesh Kumar, spokesman for India’s Ministry of External Affairs, tweeted late 22nd July that “no such request has been made” by Indian Prime Minister Narendra Modi. Kumar also reiterated that the territorial dispute needs to be resolved bilaterally between India and Pakistan, who have been bitter rivals for decades.

 

Economy-

GLOBAL INDICES AS OF 26th and 27th July 2019

As compared to 19th and 20th July 2019

Global indices as of 26th and 27th July 2019
Name Current Value Open

Close

US MARKETS
 NASDAQ (Jul 26) 8,330.21 8294.30

8238.54

EUROPEAN MARKETS
 FTSE (Jul 26) 7,549.06 7489.05

7489.05

 CAC (Jul 26) 5,610.05 5572.72

5578.05

 DAX (Jul 26) 12,419.90 12363.86

12362.10

ASIAN MARKETS
 SGX NIFTY (Jul 27) 11,314.00 11330.50

11328.50

 NIKKEI 225 (Jul 26) 21,658.15 21700.20

21756.55

 STRAITS TIMES (Jul 26) 3,363.76 3363.56

3381.26

 HANG SENG (Jul 26) 28,397.74 28406.07

28594.30

 TAIWAN WEIGHTED (Jul 26) 10,891.98 10898.25

10941.41

 KOSPI (Jul 26) 2,066.26 2063.35

2074.48

 SET COMPOSITE (Jul 26) 1,717.97 1729.26

1730.90

 JAKARTA COMPOSITE (Jul 26) 6,325.24 6379.20

6401.37

 SHANGHAI COMPOSITE (Jul 26) 2,944.54 2928.06

2937.36

 

 

Global indices as of 19th and 20th July 2019
Name Current Value Open

Close

US MARKETS
 NASDAQ (Jul 19) 8,146.49 8241.34

8207.24

EUROPEAN MARKETS
 FTSE (Jul 19) 7,508.70 7493.09

7493.09

 CAC (Jul 19) 5,552.34 5580.99

5550.55

 DAX (Jul 19) 12,260.07 12302.64

12227.85

ASIAN MARKETS
 SGX NIFTY (Jul 20) 11,380.00 11432.00

11429.50

 NIKKEI 225 (Jul 19) 21,466.99 21146.50

21046.24

 STRAITS TIMES (Jul 19) 3,377.96 3368.39

3361.05

 HANG SENG (Jul 19) 28,765.40 28585.15

28461.66

 TAIWAN WEIGHTED (Jul 19) 10,873.19 10861.99

10799.28

 KOSPI (Jul 19) 2,094.36 2080.21

2066.55

 SET COMPOSITE (Jul 19) 1,735.10 1734.38

1723.44

 JAKARTA COMPOSITE (Jul 19) 6,456.54 6417.44

6403.29

 SHANGHAI COMPOSITE (Jul 19) 2,924.20 2909.68

2901.18

 

Pakistan

Politics

  • This is all going like seeing a movie where everybody claps when Hero attacks on its enemies. Just see on a sweltering 21st July in Washington DC with temperatures hovering in the mid-40s, tens of thousands of Pakistanis began lining up outside the Capital One Arena. The excitement was palpable in the air as groups of friends, young and old couples and families (some three generations deep) waited patiently to see the prime minister from a country 7,000 miles away.“This is the magic of Imran Khan,” one attendee, who has never lived in Pakistan, told me. “Imran Khan is the only Pakistani leader who has truly engaged with overseas Pakistanis. He understands that just because we live elsewhere doesn’t mean we don’t care for the well-being of our motherland. That’s why I lined up four hours before. I didn’t want to risk missing a chance to see history in the making.”This chance to witness a slice of history is why I dragged my American-born Indian husband out early on a Sunday morning. Here’s how Prime Minister Imran Khan’s first ever American jalsa

Imran Khan is preaching to the choir instead of expanding the church. But, the attendees couldn’t care less. To be in the company of their rock star cum prodigal son is enough. Anytime he names rival politicians, there is a thunderous applause and laughter at their expense. Maulana Fazlur Rehman’s name is met with chants of “Diesel”. That his speech is light on actual solutions and substance is inconsequential. One attendee tells later that “after suffering through years of corrupt, incompetent and neglectful leaders, it is refreshing to have a leader who won’t bow down under pressure or sell his morals.” Generally, rallies are a genius tool to turn a politician’s messages into sound bite-sized mantras. And, no one knows this better than our superstar-turned-politician Imran Khan. To watch the prime minister interact with his audience is a lesson in charisma, confidence and raw emotional connection. After all, to maintain the appearance that something is happening when, in fact, not much is happening because not much has really changed, is an art. And, the prime minister has mastered this art. A few times I’m left thinking that maybe now I understand the allure of cult leaders. I want to thank the Pakistani-American community for showing up in such large numbers at Capital One Arena in DC to show support and welcome me on my first visit to the USA as PM of Pakistan.

However a US analyst George Orwell describes political speech as the “defense of the indefensible,” a type of language consists “largely of euphemism, question-begging and sheer cloudy vagueness.” In his address, the prime minister embodies all these things. But because he’s flown commercial not private, because he has chosen to dignify us with an in-person address and because he’s come to America not to plead Pakistan’s case before the powers that be but to, finally, garner respect for us in a world that has lost respect for us a long time ago, we are all happy to overlook his mostly hollow rhetoric and unnecessary political and verbal jousting.

 

  • Days after Fatema Sohail came forward and accused her husband; actor Mohsin Abbas Haider of domestic violence, Humaima Malik took to social media to share her own harrowing account of violence.

Malik, who along with her sister, Dua, claimed she had witnessed what Fatema said she went through, took to Instagram to talk about how she was also a survivor of domestic abuse. “Although it has been years but all those years and the pain filled days and nights still haunt me. I was only a 19-20 year old miserable young girl. Who couldn’t even share my screaming wounds with my family,” wrote the actor.

  • Prime Minister Imran Khan arrived at the White House for his first one-on-one meeting with US President Donald Trump.

He was received by President Trump, who greeted him with a handshake and a pat on the arm. The two waved to PTI supporters gathered outside the White House before heading inside for their meeting.

In televised remarks from inside the Oval Office, President Trump noted that the US is working with Pakistan to leave Afghanistan, saying that he does not want the US to be “a policeman” in the region. “Pakistan is helping us a lot now on Afghanistan,” he said, adding that relations with the country are much better now than before. In wide-ranging remarks, he also offered to intercede to improve strained relations between Pakistan and India, and further said that aid to Islamabad could be restored depending on the kind of understanding reached between the two leaders.

“We were paying $1.3 billion as aid for many years but the problem was that Pakistan — it was before you [PM Imran] — was not doing anything for us. They were really, I think, subversive. To be honest, we have a better relationship with Pakistan right now than we did when we were paying that money. The US president also offered to mediate the Kashmir dispute between India and Pakistan. “If I can help, I would love to be a mediator,” Trump said.

President Trump said that he could win the war in Afghanistan in a week, but that he doesn’t want to kill millions of people and wipe Afghanistan “off the face of the earth”. Prime Minister Imran told reporters that there was only one solution for Afghanistan and remarked that a peace deal with the Taliban was closer than it had ever been. “This is the closest we have ever come,” he said, agreeing that a military ‘solution’ to the Afghan war would result in a catastrophic loss of lives. He said he hoped that in the coming days, “we will be able to urge the Taliban to talk with the Afghan government and come to a political solution”, a point that was promptly appreciated by Trump — who again noted that Pakistan had helped tremendously in recent weeks.

President Trump also said that the US is willing to invest in Pakistan and sees great trade opportunities there. He also talked about expanding trade “10, 20 times”. The US leader stressed that not enough opportunities had been explored between the two countries, indicating that both sides would be see more trade with each other.

While the two leaders spoke to the media, the senior military leadership, including Chief of Armed Staff Gen Qamar Javed Bajwa and Inter-Services Intelligence chief Lt Gen Faiz Hameed, arrived at the White House for delegation-level talks. The premier later met First Lady Melania Trump.

  • Turkish President Recep Tayyip Erdogan on 26th July called Prime Minister Imran Khan and discussed bilateral relations and developments in the region.

According to a press release issued by the Prime Minister’s Office, President Erdogan “extended sympathies and condolences over the loss of precious lives in recent terrorist incidents in Pakistan”.

Both leaders reviewed the progress achieved in several areas of bilateral importance, particularly since PM Imran’s visit to Turkey in January this year.

“They noted with satisfaction the strong bonds of brotherhood and close cooperation between the two countries,” read the statement.

 

Economy

  • The Economic Affairs Division on 26th July said that the net addition to the external public debt during FY2018-19 was only $2.29 billion which is the lowest in the last three years.

The division said in a press release, “The total external inflows during FY 2018-19 were $10.186 billion, including grants of $330 million, while external loans obtained by the government during the year were $9.85 billion with the government making payment of $8.94 billion on account of retirement of external debt and debt servicing.” So the net addition to the external public debt clocked in at $2.29bn, it added.

  • Mobile phone imports during FY2018-19 decreased by 10.87 per cent compared to the corresponding period last year.

The country imported mobile phones worth $755.545 million during July-June 2018-19 compared $847.654m during July-June 2017-18, showing negative growth of 10.87pc, according to the latest data of Pakistan Bureau of Statistics. On a year-on year basis, mobile phone imports witnessed negative growth of 34.18pc in June, when compared to imports of same month last year. The mobile phone imports during the month were recorded at $57.733m against $87.717m in June 2018.

  • The large-scale manufacturing (LSM) sector shrank 3.78 per cent during May from a year ago, the Pakistan Bureau of Statistics (PBS) reported on 24th july.

The contraction came amid dismal performance in the fertilizer, leather, pharmaceutical, and chemical sectors raising fears of large-scale layoffs in the industrial sector. On a year-on-year basis, the LSM dipped by 3.5pc during the first 11 months (July-May) of this fiscal year — falling far behind the 8.1pc target set for the government for FY2018-19.

  • The automotive industry fears that amid declining auto sales, the sector is likely to lose at least 10-15 per cent of the direct jobs over the next few months.

Warning of tough times ahead, they said rising auto prices on the back of steep currency depreciation, imposition of federal excise duty in the range of 2.5-7.5pc depending on the engine size and tough economic climate have affected overall sales. Auto sales have declined by 7pc in the last financial year with experts fearing the market to shrink further by 15-20pc during the ongoing fiscal year. The major slowdown was witnessed in the sale of cars above 1,300CC, forcing both Honda and Toyota manufacturers in the country to significantly scale down production during the month to clear inventories.

           

F.C Exchange Rates of PKR as of 26th July 2019 as compared to 19th July 2019
Countries PKR rate as of 19th  July 2019 PKR rate as of 26th July 2019
U.S.A. 160.80 160.90
U.K. 204.00 202.00
Euro 182.50 180.50
Japan 1.48 1.50
Saudi Arabia 43.15 43.05
U.A.E. 43.95 43.90

 

Pakistan Stock Exchange Indices

As of 26th July 2019 As Compared

To 19th July 2019

 

Position as of 26th July 2019
Symbols KSE100 Index PSX-KMI All Shares Index
Advance 52 (Curr) Current 32103.27 Current 14873.46
Decline 229 (High) High 32446.40 High 15054.17
Unchanged 17 (Low) Low 32031.98 Low 14813.40
Total change 298  -343.13  -173.95

 

Position as of 19th July 2019

Symbols KSE100 Index PSX-KMI All Shares Index
Advance 130 (Curr) Current 32458.77 Current 15051.60
Decline 130 (High) High 32549.31 High 15081.45
Unchanged 34 (Low) Low 31901.28 Low 14784.41
Total Change 294  149.23  128.10

 

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