PKR rises 68 paise against dollar after $1.

5bn ADB loan accord:

According to the State Bank of Pakistan, the current exchange rate for one Pakistani rupee to one U.S.
dollar is Rs219.73, up 68 paise, or 0.31 percent, from the previous day's close of Rs220.41. Pakistan has
inked a loan agreement with the ADB for budgetary support and assistance in restoration and
reconstruction works following the devastating floods that have hit the country.
Director of online financial portal Mettis Global Saad Bin Naseer has speculated that the signing of the
ADB deal and the hope for debt rescheduling from China could help the rupee maintain this pace in the
coming days. Pakistan's Finance Minister Ishaq Dar is now in the United States for discussions with the
International Monetary Fund (IMF) and the World Bank. He is also anticipated to travel to China soon to
hold negotiations on the country's bilateral debt restructuring.
According to Naseer, the minister's travel to China might be good news for the rupee because it will likely
result in the two countries reaching an agreement on new projects. The general secretary of Pakistan's
Exchange Commission (Ecap), Zafar Peracha, recently stated that the country's import bill has decreased
in addition to the ADB loan arrangement, resulting in a smaller current account deficit. He also noted that
the rupee would receive another $4 billion in funding from "friendly countries" in the coming months. He
also mentioned that Pakistan's finance minister is planning a trip to France, which he hopes would provide
more "positive news" for the country and help the currency.
The currency trader explained that the recent downward pressure on the rupee was due to hefty import
payments, but he was optimistic that these good events will help bring the dollar down below Rs200 in
the coming months.

Gains of 134 points are seen in the market as a result of several optimistic factors:
According to Arif Habib Ltd, investors stayed away from the stock market despite the good trigger
because of the ongoing political unrest. There was a decent volume for the mainboard stocks, but the
leaders in volume were primarily tier-three companies. On the foreign exchange market, the local
currency rose 0.2% to 220.41 per dollar. At these prices, JS Global advised investors to be careful and
wait for price declines before making any new purchases.
Because of this, the KSE-100 index ended the day at 42,347.23, up 133.75 points, or 0.32 percent, from
the previous session's close. The day-to-day volume of trades fell 21.7% to 226.7 million shares, and the
value of those trades fell 22.9% to $27.5m. WorldCall Telecom Ltd (68.7 million shares), Dewan Motors
Ltd (12. 4 million shares), Pakistan Refinery Ltd (9.5 million shares), Hascol Petroleum Ltd (9 million
shares), and TRG Pakistan Ltd (9 million shares) all contributed considerably to the amount of trading
(8.7m shares).
The index's strength may be traced to contributions from the information technology and
telecommunications (46.9 points), fertiliser (40.9%), exploration and production (24.4 points), electricity
generation and distribution (22.6 points), and auto parts and accessories (22.6%). (7.2 points). Colgate-
Palmolive Pakistan Ltd (Rs40.19), Mari Petroleum Company Ltd (Rs26.74), Premium Textile Mills Ltd
(Rs25), Khyber Tobacco Company Ltd (Rs21.20), and JDW Sugar Mills Ltd (Rs20.20) saw the largest
percentage gains in their share prices (Rs19).
Gatron Industries Ltd (Rs31.20), Sitara Chemical Industries Ltd (Rs18.74), ICI Pakistan Ltd (Rs10.29),
Al-Abbas Sugar Mills Ltd (Rs8), and Towellers Ltd (Rs8) saw the largest percentage drops in rupee value
across all bourses (Rs7.42). The $0.37m in shares sold by overseas investors shows they are still net
sellers.

Ishaq Dar rejects a tax holiday for overseas IT sales:

However, the government has agreed to provide maximum assistance, including freedom from
examination by the tax authorities, in response to the IT industry's request that it waive a "negligible" tax
on its services in order to boost the sector's flagging exports.
Finance Minister Ishaq Dar, who presided over a meeting of the IT sector on Sunday, referred to the
effective tax rate on the sector as "peanuts," given that it was just approximately 0.25 percent. He argued
that people should get in the habit of paying income taxes rather than claiming deductions. Mr. Dar
characterised a tax of Rs2.5 on exports of Rs1,000 as "nothing." In order to reduce the financial burden on
the government, he assured IT professionals that the Federal Board of Revenue (FBR) would not send
them tax notices and would not examine their tax returns if they were exporting their services.
To further ease the burden on businesses in the IT industry, he also instructed the FBR to establish a
department staffed by specially trained officers to process refund and tax credit applications. Dar, the
Minister of Finance, leads the Prime Minister's Task Force on Information Technology and Telecom.
Besides the chairpersons of the Federal Bureau of Revenue and the Pakistan Telecommunication
Authority, IT Minister Syed Aminul Haque, SAPM on Youth Affairs Shaza Fatima Khawaja, SAPM on
Finance Tariq Bajwa, State Bank Governor Jameel Ahmed, Finance Secretary Hamid Yaqoob Shaikh, IT
Secretary Mohsin Mushtaq, and State Bank Governor Jameel Ahmed were present at the meeting of the
task force.

Business leaders said they will depart FATF in order to relieve the liquidity crisis:
The business community in Pakistan expressed optimism on Sunday that the country's economy would
benefit from Pakistan's removal from the Financial Action Task Force's (FATF) grey list, which would
help to attract foreign direct investment and solve the liquidity problems that Islamabad has been
experiencing. Business leaders have praised the decision of the terror financing watchdog, saying that the
FATF exit will restore the faith of international financial institutions and enhance Pakistan's credit ratings,
setting the country on the path to sustainable growth.
Irfan Iqbal Shaikh, president of the Federation of Pakistan Chamber of Commerce and Industry,
expressed optimism that the removal would solve the country's cash problems since it would lead to
greater releases of funds from multilateral financial organisations and other donor agencies.
The International Monetary Fund, the Asian Development Bank, and the World Bank would have more
faith in Pakistan if it were taken off the "grey list," according to Ahsan Zafar, president of the Islamabad
Chamber of Commerce and Industry. A softer image of the country, he claimed, would be promoted
thanks to the decision. He stated that Pakistan had lost $40 billion in the last three years due to being on
the grey list, and that removing it would increase export orders from overseas, thus reducing the trade
deficit.
And, he continued, "it will also assist reduce the rupee-dollar parity and facilitate negotiations with the
IMF and other multilateral donors and creditors." According to Shahzad Ali Malik, chairman of the
Pakistan Hi-Tech Hybrid Seed Association (PHHSA), removing the grey list will cause an increase in
economic activity and a restoration of investor trust around the world. After much effort by Pakistani
officials, the global watchdog for money laundering and terrorism financing removed Pakistan from a list
of countries under "enhanced monitoring" earlier this week.

Accord signed with ADB for $1.5bn loan:

On Monday, Pakistan and the Asian Development Bank (ADB) signed an agreement for the ADB to lend
Pakistan $1.5 billion to help with budgetary support and flood recovery efforts. Kazim Niaz, Secretary of
the Economic Affairs Division (EAD), and Yong Ye, ADB's Country Director, signed the loan
agreement. The ceremony was attended by the ADB's Director General for the Central & West Asia
Region, Eugene Zhukov, as well as the Pakistani Prime Minister Shehbaz Sharif and the Pakistani
Finance Minister Ishaq Dar and the EAD Minister Ayaz Sadiq.
This loan from the Asian Development Bank's (ADB) BRACE Programme will be used to support the
Ukrainian government's $2.3bn countercyclical development spending programme, which is intended to
mitigate the effects of external shocks like Russia's invasion of Ukraine.
In the wake of disastrous floods and worldwide supply chain disruptions, the $1.5 billion loan aims to
provide social protection, boost food security, and support employment. The disbursement of the
approved loan is scheduled for the next week, and it is anticipated that this will help to increase foreign
exchange reserves and slow the depreciation of the rupee.

Reference:
https://www.dawn.com/business