Economic & Political Weekly 31-03-2019

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World

Politics

  • EU leaders know, in theory, that all Brexit options remain on the table and they haven’t entirely given up hope of a negotiated UK departure, but there is little trust here that the prime minister or Parliament will manage to pull it off.

Ongoing Brexit divisions in parliament, in government and in Theresa May’s cabinet were on screaming Technicolor display again last week. MPs have rejected Theresa May’s EU withdrawal agreement on the day the UK was due to leave the EU. The government lost by 344 votes to 286, a margin of 58.It means the UK has missed an EU deadline to delay Brexit to 22 May and leave with a deal. The UK was supposed to leave the EU on 29th March but, following the government’s latest setback, it is no clearer when Brexit will happen. The UK faces a new deadline of 12 April to come up with a way forward. The EU is planning an emergency summit on 10 April to discuss its next move. So where does the process go from here nobody knows?

  • When a last-minute spacesuit switch saw the cancellation of NASA’s all-female space walk, it sparked bigger conversations about how women navigate a world appeared to be designed for men.

Caroline Criado Perez, a journalist and the author of Invisible Women have Exposed Data Bias in a World Designed for Men, “This is just what happens over and over when it comes to what we design,” she says. “We are so used to thinking of men as the default and women as the sort of niche – a variety of man.” Ms Criado Perez began researching gender bias after discovering that medical data around heart attacks was based on male symptoms, causing clinicians to miss heart attack cases in women since those symptoms were considered atypical. “It’s the same thinking that leads NASA to put two larges as the average, when it’s the average for men, actually.” From police stab vests that don’t account for breasts, to safety goggles too large for women’s faces, to boots that don’t fit women’s feet, Ms Criado Perez says the list is endless.

  • Hundreds of thousands of people have taken to the streets in Algeria to demand the resignation of President Abdelaziz Bouteflika.

Estimates say crowds in the capital, Algiers, reached a million. It is the sixth successive Friday i.e. 29th March of mass anti-government protests in the country. Earlier this week an army general, Lt Gen Ahmed Gaed Salah, called for the position of president to be made vacant. But opposition parties in Algeria said it would not guarantee free elections. The renewed calls for regime change come just days after Lt Gen Gaed Salah demanded that Mr Bouteflika be declared unfit to rule.

·         At least 45 killed in Iranian floods with more rain predicted

Authorities in Iran worked on 30th March to evacuate villages threatened by flooding in southwestern areas as forecasters predicted more of the heavy rains that have killed at least 45 people this week, state media reported. State television said at least 11 villages lying near the Dez and Karkheh rivers in the oil-rich southwestern province of Khuzestan were being evacuated as officials released water from two major dams along the rivers due to forecasts for more rain. Energy minister Reza Ardakanian, who is in charge of water resources, said authorities were working round-the-clock to “control floodwaters and to minimize possible damage”. “It’s estimated that in the next five days about three billion cubic meters of water will flow into dam reservoirs in Khuzestan due to rainfall . . . 1.8 billion of which [is above capacity and] will have to be released,” he told state television.

  • Bangladesh: At least 19 killed, 70 injured in Dhaka high-rise fire

At least 19 people were killed and 70 injured in a fire in a 22-storey building in the Banani commercial district of the Bangladeshi capital Dhaka on 28th March officials said. Officer Khurshid Anwar of the Bangladesh Fire Service said that 21 firefighting units had been dispatched to douse the blaze, which was brought under control late on 28th March afternoon. Military helicopters joined the rescue operation, and one person dangled from a helicopter hovering over the roof as thick plumes of smoke cascaded upwards.

 

Economy-

  • Chinese tech companies are battling the United States for global supremacy.

China is home to nearly one-third of the world’s 326 unicorns, or startups worth over a billion dollars, according to a new report this week from Credit Suisse. But US companies have a major edge when it comes to cutting edge fields like artificial intelligence, software and robotics. Only 14% of Chinese unicorns are focused on those high-tech industries, compared to 40% of their American counterparts, the report said. The United States and China together account for three out of every four unicorns globally, with 156 and 93 respectively. China’s main hurdle is its relative lack of research investments. “China’s scientific research, especially basic research, is still in a catch-up phase,” said Vincent Chan, Credit Suisse’s head of China equity strategy.

 

GLOBAL INDICES AS OF 29th March 2019

As compared to 22nd March 2019 

Global indices as of 29th March 2019
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US MARKETS
 NASDAQ (Mar 29) 7,729.32 7669.17
EUROPEAN MARKETS
 FTSE (Mar 29) 7,279.19 7234.33
 CAC (Mar 29) 5,350.53 5296.54
 DAX (Mar 29) 11,526.04 11428.16
ASIAN MARKETS
 NIKKEI 225 (Mar 29) 21,205.81 21033.76
 STRAITS TIMES (Mar 29) 3,212.88 3203.58
 HANG SENG (Mar 29) 29,051.36 28775.21
 TAIWAN WEIGHTED (Mar 29) 10,641.04 10536.26
 KOSPI (Mar 29) 2,140.67 2128.10
 SET COMPOSITE (Mar 29) 1,638.65 1634.25
 JAKARTA COMPOSITE (Mar 29) 6,468.76 6480.79
 SHANGHAI COMPOSITE (Mar 29) 3,090.76 2994.94
 SGX NIFTY (Mar 30) 11,702.50 11675.50

 

 

Global indices as of 22nd March 2019

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US MARKETS
 NASDAQ (Mar 22) 7,642.67 7838.96
EUROPEAN MARKETS
 FTSE (Mar 22) 7,207.59 7355.31
 CAC (Mar 22) 5,269.92 5378.85
 DAX (Mar 22) 11,364.17 11549.96
ASIAN MARKETS
 NIKKEI 225 (Mar 22) 21,627.34 21608.92
 STRAITS TIMES (Mar 22) 3,212.10 3213.65
 HANG SENG (Mar 22) 29,113.36 29071.56
 TAIWAN WEIGHTED (Mar 22) 10,639.07 10609.55
 KOSPI (Mar 22) 2,186.95 2184.88
 SET COMPOSITE (Mar 22) 1,646.29 1634.00
 JAKARTA COMPOSITE (Mar 22) 6,525.27 6501.78
 SHANGHAI COMPOSITE (Mar 22) 3,104.15 3101.46
 SGX NIFTY (Mar 23) 11,407.00 11470.00

 

 

Pakistan

Politics

  • A strategic shift in the foreign policy of Pakistan under CPEC

China and Pakistan both want Afghanistan to join CPEC. Pakistan is pursuing a foreign policy of creating a peaceful and stable neighborhood. In another break with its past actions of joining blocs or being part of a proxy war, Pakistan has facilitated a round of peace talks between the US and the Afghan Taliban. And despite India’s aggressive behavior, Pakistan has sent out a message of peace. Instead of paying heed to the actions of the US and India, Pakistan foreign policy has focused on regional integration, peaceful coexistence and socioeconomic development. Strategic cooperation and interdependence between China and Pakistan has increased manifold in the post-9/11 era, mainly due to CPEC and Pakistan’s strategic position in the region, and this cooperation will increase further in years to come.

  • The government on 27th March shared with the Indian government its initial findings on the dossier handed over by Delhi on the Pulwama incident, a statement issued by the Foreign Office said.

The Indian High Commissioner in Islamabad was called to the Ministry of Foreign Affairs by the Foreign Secretary and the findings on the Pulwama incident were shared with him. The prime minister had earlier offered cooperation in an investigation into the incident if Delhi shared any actionable evidence concerning the suicide bombing in occupied Kashmir’s Pulwama area, which had targeted Indian paramilitary soldiers. In response to the premier’s offer, India had handed over documents to Pakistan on February 27 amidst soaring tensions. “Pakistan has acted with a high sense of responsibility and extended full cooperation. We do so in the interest of regional peace and security,” the Foreign Office said in its statement. “We have sought further information/evidence from India to take the process forward,” it added.

The Federal Cabinet on 26th March approved a new revolutionary civil aviation policy to pro-actively promote tourism and give boost to aviation industry in the country.

Briefing media persons about the decisions made in the cabinet meeting chaired by Prime Minister Imran Khan, Minster for Information and Broadcasting Chaudhry Fawad Hussain said traveling to the tourist resorts of Pakistan will be facilitated by reducing expenditures. Fawad said facilities, including reduction in traveling expenses and cuts in taxes, worth Rs 3.8 billion would be offered to promote tourism and aviation sector. He said that the cabinet also discussed to start helicopter and 40-seat plane service to the tourist sites in the country, including Gilgit-Baltistan and Swat. The minister announced that passenger airlines in Pakistan will be allowed to import airplanes which are 18-years-old compared to the previous limit of 12 years while cargo planes up to 30 years old, could be imported. New recommendations with regards to aviation also included charges on flight kitchens being abolished, and a recommendation to reduce taxes on domestic routes, he added. The minister also announced a special initiative by CAA of paying up to Rs 400,000 in fees for women to attract them for becoming pilots. The Federal Cabinet Tuesday approved a new revolutionary civil aviation policy to pro-actively promote tourism and give boost to aviation industry in the country.

  • 6,799 Pakistanis are jailed in different Gulf countries. Some 3,349 Pakistanis are incarcerated in Saudi Arabian jails while 3,450 are lodged in other gulf jails.

After the Saudi crown prince’s order some prisoners had been released. However, collectively 2,107 prisoners are still to be released. The concerned departments are saying that they were in contact with the Pakistani mission and officials in Saudi Arabia and had directed them to facilitate the prisoners.

 

Economy

  • Pakistan’s central bank raised its key interest rate by 50 basis points to 10.75 percent on 29th March, citing continuing inflationary pressures and a high fiscal and current account deficit. 

The State Bank of Pakistan said pressure on foreign exchange reserves had eased since the last meeting of the monetary policy committee in January, with improved stability on financial markets and better business confidence.  Nonetheless, despite narrowing, the current account deficit remains.

  • Pakistan is likely to secure a bailout package from the International Monetary Fund (IMF) of between $6 billion and $12bn by the middle of May, Finance Minister Asad Umar has said.

In an interview after a meeting with the IMF, he said he hoped an agreement would be reached with the Fund by “late April, first half of May”. The package would be of between $6bn and $12bn. “We’re approaching the landing zone,” said Mr. Umar. “The gap between our position and the IMF’s is significantly less than what it was a few months back.”
A sticking point in the negotiations between the two sides seems to be the exchange rate management of the rupee, which has lost 33 per cent of its value since 2017 when compared to that of the dollar.

 

F.C Exchange Rates of PKR as of 30th  March 2019 as compared to 22nd March 2019
Countries PKR rate as of  22nd   March 2019 PKR rate as of 30th March 2019
U.S.A. 140.10 141.40
U.K. 185.00 186.25
Euro 159.30 158.70
Japan 1.2700 1.2900
Saudi Arabia 37.25 37.70
U.A.E. 38.15 38.35

 

 

 

Pakistan Stock Exchange Indices

As of 29th March 2019 As Compared

To 22nd March 2019

 

Position as of 29th March 2019
Symbols KSE100 PSX-KMI
Advanced (Curr.) 166
38649.34
18685.69
Declined (High) 119
38733.37
18685.75
Unchanged (Low) 22
38483.46
18554.78
Total (Change) 307
96.39
90.54

 

Position as of 22nd March 2019
Symbols KSE100 PSX-KMI
Advanced (Curr.) 133
38531.87
18517.32
Declined (High) 155
38721.05
18620.25
Unchanged (Low) 27
38384.72
18377.94
Total (Change) 315
147.15
139.38

 

 

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