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Keti Bandar Port Phase-I Cost Estimated At $522.34m With 500-Metre Terminal
Pakistan

Keti Bandar Port Phase-I Cost Estimated At $522.34m With 500-Metre Terminal

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The Keti Bandar Port Phase-I development has been estimated to cost around $522.34 million, with the first stage of the proposed project featuring a 500-metre multi-purpose terminal as part of a new deep-water maritime gateway in Sindh. The estimated cost was disclosed during a presentation by China Harbour Engineering Company (CHEC) on the proposed development of Keti Bandar Port. The Chinese company presented a Conceptual Master Plan outlining a deep-water maritime gateway with multiple terminals, logistics facilities and supporting infrastructure. The proposed project is being considered as a major maritime and economic development initiative in Sindh. The Federal Ministry of Maritime Affairs and the Sindh government have agreed to pursue the development of the port. Keti Bandar Port Phase-I Includes 500-Metre Quay According to the Conceptual Master Plan presented by CHEC, the first phase of the project will include a multi-purpose terminal with a 500-metre quay. The preliminary engineering cost for this phase has been estimated at approximately $522.34 million. The proposed terminal would form part of a broader deep-water port complex designed to include multiple terminals, logistics facilities and other supporting infrastructure. The development could eventually increase Pakistan’s maritime handling capacity and provide an additional gateway for trade. CHEC’s delegation included Wu Ping, Chief Representative of CHEC in Pakistan, Wang Zongde, Head of the Marketing Department, Engineer Xu Tielin and Raza, General Manager of Strategy and Marketing. The presentation provided an initial framework for the development of the proposed port, while further technical studies and planning are expected to determine the project’s final scope, cost and implementation structure. Zardari Calls For Integrated Port Development President Asif Ali Zardari welcomed the Chinese delegation and appreciated China’s continued interest in supporting Pakistan’s infrastructure and maritime development. The president stressed that Keti Bandar Port should not be developed as an isolated maritime facility. Instead, he called for an integrated approach that links the port with reliable road connectivity, electricity and water supplies, industrial infrastructure and other essential facilities. According to the president, dependable supporting infrastructure will be crucial to ensuring that the proposed port can operate efficiently and contribute to wider economic activity. Road connectivity, in particular, would be important for linking the port with industrial areas, markets and other parts of Pakistan’s transportation network. Similarly, reliable power and water supplies would be required for port operations and the development of associated industrial and logistics facilities. An integrated approach could also help maximise the economic benefits of the proposed project by creating stronger links between maritime trade, logistics and industrial activity. Proposed Port Could Strengthen Trade Network President Zardari said Keti Bandar had significant potential to become an additional maritime gateway for Pakistan. He said the project could strengthen the country’s port and logistics network while supporting greater trade and regional connectivity. The development of another deep-water maritime gateway could provide additional opportunities for cargo movement and logistics activity. However, the project’s eventual impact will depend on the development of supporting infrastructure and the establishment of an effective commercial and operational framework. The president emphasised the need for close technical coordination between CHEC and relevant Pakistani authorities to ensure that the project is planned and developed effectively. He also called for continued engagement to refine the Conceptual Master Plan and determine an appropriate implementation and financing framework. The financing structure will be particularly important given the preliminary $522.34 million engineering cost for Phase-I. Further assessments will be required to determine the overall investment requirements for the complete port and associated infrastructure. Environmental Protection Highlighted President Zardari also placed strong emphasis on environmental sustainability during the proposed development of Keti Bandar Port. He called for the protection of the fragile Indus Delta ecosystem, highlighting the environmental sensitivity of the area. The president also stressed the need to protect the interests and livelihoods of local fishing communities. The proposed port development will therefore need to balance economic and maritime objectives with environmental safeguards and the concerns of communities that depend on coastal resources. Detailed environmental and technical assessments are expected to play an important role as the project moves forward. Pakistan And China Continue Port Development Cooperation The Keti Bandar project reflects continued cooperation between Pakistan and China in infrastructure and maritime development. CHEC’s presentation of the Conceptual Master Plan provides an initial framework for developing the proposed deep-water gateway, but further technical work will be required before construction and financing arrangements are finalised. The next stages are expected to focus on refining the master plan, assessing infrastructure requirements, determining the financing model and establishing an implementation framework. With Phase-I estimated at $522.34 million, the proposed Keti Bandar Port represents a significant infrastructure investment. If developed with adequate connectivity, supporting facilities and environmental safeguards, the project could eventually strengthen Sindh’s maritime infrastructure and expand Pakistan’s capacity for trade and logistics.

Moody's Ratings Upgrade Pakistan to B3 as Reserves and Fiscal Metrics Improve
Pakistan

Moody’s Ratings Upgrade Pakistan to B3 as Reserves and Fiscal Metrics Improve

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Pakistan has received a significant credit rating upgrade as Moody’s Ratings upgrade Pakistan from Caa1 to B3, citing sustained improvements in the country’s external position, stronger fiscal indicators and easing debt pressures. The upgrade is an important development for Pakistan because credit ratings influence how international investors, lenders and bond markets assess the country’s ability to meet its financial obligations. However, the improvement should not be interpreted as a clean bill of health. Moody’s itself continues to identify serious structural weaknesses that could quickly reverse recent gains. Moody’s Ratings Upgrade Pakistan Reflects Stronger External Position Moody’s said Pakistan’s external vulnerability has eased considerably since its previous rating action in August 2025. Foreign exchange reserves have increased steadily as macroeconomic stabilization has reduced pressure on the external account. Pakistan’s foreign exchange reserves reached approximately 17 billion dollars at the end of July 2026, compared with around 14 billion dollars a year earlier. The improvement provides nearly three months of import cover and gives policymakers greater protection against external financing shocks. The country’s External Vulnerability Indicator has also improved. The ratio of short term and long term debt maturities to foreign exchange reserves is estimated at about 145 percent in 2026, compared with 230 percent in 2025. This is a meaningful improvement, but the ratio remains high. Pakistan therefore remains dependent on continued access to external financing and official creditor support. Lower Interest Rates Are Reducing Pakistan’s Debt Burden One of the most important factors behind the improved credit assessment is the decline in domestic borrowing costs. Interest payments consumed approximately 35 percent of government revenue in fiscal 2026, down sharply from 49 percent in fiscal 2025. The reduction has been supported by lower interest rates following a significant decline in inflation. Pakistan’s policy rate stood at 11.5 percent in July 2026, compared with a peak of 22 percent between June 2023 and May 2024. Lower interest costs are providing the government with greater fiscal breathing room. However, debt affordability remains weak by international standards. Moody’s expects the ratio to remain around 35 percent over the next one to two years before gradually improving if fiscal consolidation continues. IMF Programme Remains Critical to Pakistan’s Credit Rating The continued implementation of Pakistan’s IMF backed reform programme has strengthened policy credibility and supported financing from official creditors. Pakistan has also gradually returned to international capital markets. The country issued a three year 750 million dollar Eurobond in April 2026 and launched a 1.75 billion yuan Panda bond, worth approximately 250 million dollars, in May 2026. Moody’s expects foreign exchange reserves to reach approximately 19 to 20 billion dollars by the end of fiscal 2027 and 20 to 21 billion dollars in fiscal 2028, assuming Pakistan maintains progress under the IMF programme. That assumption is crucial.Pakistan’s external financing requirements are estimated at about 21 billion dollars in fiscal 2027 and around 30 billion dollars in fiscal 2028. A substantial portion is expected to come through the rollover of existing bilateral deposits. Moody’s Upgrade Does Not Remove Pakistan’s Economic Risks The most important warning in the Moody’s assessment is that Pakistan remains structurally vulnerable. The country still faces a narrow revenue base, weak debt affordability, limited ability to attract investment and difficulties in generating high productivity economic growth. Political uncertainty, institutional weaknesses and external financing risks also remain significant. This is where the latest upgrade deserves careful interpretation. A move from Caa1 to B3 is encouraging, but B3 remains firmly within speculative territory. Pakistan has not suddenly become a low risk investment destination. Instead, the upgrade indicates that the probability of immediate financial stress has declined because reserves, fiscal indicators and policy credibility have improved. The bigger challenge is whether these improvements can survive political pressure, rising import demand, global interest rate changes and future external financing requirements. Pakistan Still Trails Stronger Emerging Market Ratings Pakistan now carries a B3 rating from Moody’s with a stable outlook. Fitch Ratings maintains Pakistan at B minus with a stable outlook, while S&P Global Ratings assigns a B rating with a stable outlook. Moody’s has also raised Pakistan’s local currency country ceiling to B1 and its foreign currency ceiling to B3. The stable outlook reflects a balance between potential improvements in Pakistan’s economic fundamentals and the possibility that persistent vulnerabilities could weaken access to foreign currency financing and reduce fiscal flexibility. The Real Test Begins After the Moody’s Ratings Upgrade Pakistan The Moody’s Ratings upgrade Pakistan story is undoubtedly positive for the country’s financial credibility. Stronger reserves, lower interest costs and improved fiscal indicators provide a stronger foundation for economic stability. But the upgrade should be treated as an opportunity rather than a victory. Pakistan still needs to broaden its tax base, improve exports, attract productive investment, strengthen institutions and reduce dependence on repeated external financing arrangements. If reforms continue, the latest upgrade could become the beginning of a broader improvement in Pakistan’s credit profile. If reforms stall, the current gains could prove temporary. For investors, the message is therefore mixed. Pakistan is showing greater resilience than during previous external crises, but its economic fundamentals remain fragile. The next stage will depend less on securing another rating upgrade and more on whether the government can convert short term stabilization into sustainable economic growth.

PSX Welcomes Tasdeeq as 11th Listing of CY-2026 amid Record Demand
Pakistan

PSX Welcomes Tasdeeq as 11th Listing of CY-2026 amid Record Demand

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Karachi, August 24, 2026: The Gong Ceremony of Tasdeeq Information Services Limited was held today at PSX Trading Hall, marking the listing of South Asia’s first publicly listed credit bureau. The transaction covered 219 million ordinary shares: 69 million placed with pre-IPO investors at PKR 2.35 and 150 million offered through the IPO at a strike price of PKR 3.00, bringing the total transaction size to approximately PKR 612 million. The retail portion was oversubscribed 21.68 times, attracting 11,358 applications and PKR 2.4 billion in total participation. This milestone strengthens Pakistan’s capital markets, boosts investor sentiment, and highlights the growth potential of the country’s data and analytics sector. Mr. Farrukh H. Sabzwari, Managing Director & CEO of PSX, stated: “It is a privilege to welcome Tasdeeq Information Services Limited to the Pakistan Stock Exchange. This Gong Ceremony marks the 11th listing of the calendar year and the 3rd of the fiscal year, underscoring the strong momentum of Pakistan’s capital markets. Tasdeeq’s admission as a licensed credit bureau reflects the growing diversity of businesses choosing the Exchange to raise capital and grow.” He added: “Investor accounts have now crossed 600,000, driven increasingly by Millennials and Gen Z participating through awareness sessions and digital platforms. It is this deepening investor base that powered the strong oversubscription of Tasdeeq’s IPO, highlighting the enduring appetite for innovative companies and the long-term growth of Pakistan’s capital markets.” The Chairman and Board of Tasdeeq Information Services Limited led the celebration, reaffirming the company’s commitment to strengthening Pakistan’s credit information infrastructure and supporting responsible lending across banks, microfinance institutions and digital lenders. Mumtaz Hussain, CEO of Tasdeeq, thanked investors and shared plans to expand the company’s B2C offering, while Mohammed Sohail, CEO of Topline Securities — Consultant to the Issue — noted the exceptional retail response that led to the retail allocation being raised from 25% to 35%, a first in Pakistan’s IPO history.

PSO Decade Old Receivables Hit Rs908.7bn as Circular Debt Persists
Pakistan

PSO Decade Old Receivables Hit Rs908.7bn as Circular Debt Persists

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Pakistan State Oil’s (PSO) total major receivables have reached Rs908.7 billion, highlighting the continued impact of circular debt and long-standing payment delays across Pakistan’s energy sector. Of the total amount, Rs525.8 billion is overdue, while late payment surcharge (LPS) accounts for nearly Rs380 billion. SNGPL Remains The Dominant Debtor Sui Northern Gas Company Limited (SNGPL) remains PSO’s largest debtor, owing Rs535.5 billion for RLNG supplies made between 2017 and 2025. The principal amount stands at Rs274 billion, while LPS and accrued surcharge together exceed Rs261 billion. This single exposure represents more than half of PSO’s total major receivables. The large surcharge compared with the original principal highlights how prolonged payment delays continue to increase outstanding liabilities. Power Sector And Government Claims Add Further Pressure Receivables from the power sector total Rs168.3 billion, with most linked to furnace oil supplied to GENCOs and KAPCO between 2017 and 2022. Late payment charges make up a significant portion of these outstanding dues. Claims involving PIA and the federal government stand at Rs118.1 billion. These include a Rs60.8 billion exchange-rate differential on an FE-25 loan dating back to 2013. A separate Rs24.2 billion claim related to the 2025 conflict, along with older Petroleum Division dues from 1996-2014, also remain unresolved. PIA’s jet-fuel dues from 2023, including surcharge, add another Rs31.2 billion. Pakistan Railways owes Rs5.3 billion for high-speed diesel and lubricants supplied in 2025. Of this amount, Rs2 billion is overdue, while the remainder is not yet due. An Rs81.5 billion sales-tax receivable from the Federal Board of Revenue, pending since 2022, also remains on PSO’s books. PSO Payables Remain Far Lower In contrast, PSO’s major payables total only Rs157.7 billion. Refinery dues account for Rs56.2 billion, while letters of credit, Kuwait Petroleum Corporation and standby letter of credit payments related to LNG make up the remaining Rs101.5 billion. The significant gap between receivables and payables has created a persistent liquidity mismatch for the oil marketing company. Working capital remains tied up in government and utility dues even as PSO continues to meet import and supplier obligations. Circular Debt Continues To Pressure Energy Sector The latest position as of the July 20, 2026 closing shows little improvement in the circular debt chain that has long affected Pakistan’s energy sector. Unresolved historic claims and growing late payment surcharges are making recovery increasingly complicated for PSO. The scale of outstanding receivables also highlights the broader financial pressure created when payments move slowly through the energy supply chain.

K-Electric’s Financial Reporting Delay Continues, Leaving Investors Without FY2025 Results
Pakistan

K-Electric’s Financial Reporting Delay Continues, Leaving Investors Without FY2025 Results

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K-Electric Limited (KEL), Pakistan’s only vertically integrated power utility, remains significantly behind its statutory financial reporting obligations, with audited results for the year ended June 30, 2025 still unavailable as of August 2026. The prolonged delay means shareholders and investors have been without the company’s latest audited financial information for more than 13 months after the close of FY2025. The situation also continues under K-Electric’s new leadership, headed by CEO Syed Muhammad Taha and Chairman Shaheryar Arshad Chishty. K-Electric Remains Beyond Statutory Reporting Deadline Under Section 223 of the Companies Act, 2017, listed companies are required to present audited financial statements before shareholders at an Annual General Meeting within 120 days of the financial year-end. For companies with a June 30 financial year-end, the normal deadline falls around late October. The Securities and Exchange Commission of Pakistan (SECP) can grant an extension of up to 30 days in special circumstances. Pakistan Stock Exchange (PSX) regulations also require companies to disseminate financial results promptly after Board approval and provide the annual report to shareholders at least 21 days before the AGM. K-Electric has gone well beyond these timelines. Latest Available Results Date Back To 2024 The latest financial information available through the PSX Data Portal dates back to September 23, 2025, covering K-Electric’s financial year ended June 30, 2024. Audited accounts for FY2025 have not been released, while subsequent quarterly results also remain outstanding. This leaves investors without a complete picture of the utility’s latest financial position, profitability, liabilities and cash-flow situation. PSX Had Already Set A March 2026 Deadline The reporting backlog is not new. In December 2025, PSX directed K-Electric to submit overdue financial statements covering FY2024 and FY2025 and conduct the related AGMs by March 31, 2026. That deadline has since passed without the outstanding FY2025 accounts being presented. The continued delay raises questions about how quickly the company can clear its regulatory and reporting backlog under its new management. Auditors Raised Concerns Over NEPRA Proceedings The reporting problem emerged in late 2025 when K-Electric’s auditors sought greater clarity over the potential financial impact of several pending proceedings before the National Electric Power Regulatory Authority (NEPRA). These matters reportedly included tariff reviews, write-off claims and related reconsideration requests. K-Electric had previously postponed its scheduled November 2025 AGM, citing uncertainty surrounding the outcomes of these regulatory matters. The unresolved proceedings appear to have complicated the process of finalising the company’s financial accounts. Syed Taha Takes Charge Amid Reporting Backlog The prolonged delay has continued through a major leadership transition at K-Electric. In March 2026, the company’s Board appointed Syed Muhammad Taha as Chief Executive Officer, effective April 15, 2026, replacing interim CEO Adeeb Ahmad. Taha brought extensive experience from the energy sector, having served as Managing Director and CEO of Pakistan State Oil (PSO) from 2020 to 2026. He also previously held the position of Chief Distribution Officer at K-Electric. His appointment came alongside a change at the Board level, with Shaheryar Arshad Chishty assuming the role of Chairman. New Management Faces Multiple Challenges The new leadership inherited an energy company dealing with several significant operational and regulatory challenges. These include: While Syed Taha has emphasised operational improvements, infrastructure upgrades and better service reliability, clearing the company’s outstanding financial reporting remains a critical corporate governance issue. Reporting Delays Create Investor Uncertainty For shareholders, audited financial statements are essential for assessing the company’s financial health and future prospects. A prolonged absence of audited accounts makes it harder for investors to evaluate: The uncertainty can also affect credit assessments and discussions with lenders, investors and other financial stakeholders. Regulatory Scrutiny Could Increase PSX and SECP have powers to issue directives and take action against companies that fail to meet applicable reporting requirements. Possible regulatory consequences can include penalties, additional compliance directions and increased scrutiny. However, the continued absence of FY2025 financial statements as of August 2026 raises questions about whether further regulatory action will be taken to address the prolonged delay. The March 2026 PSX deadline has already passed, making the outstanding reporting issue increasingly difficult to treat as a routine administrative delay. K-Electric’s Transparency Challenge K-Electric operates one of Pakistan’s most strategically important power networks, making timely financial disclosure particularly important. The company’s financial position has implications not only for shareholders but also for lenders, regulators, suppliers, employees and other stakeholders connected to the electricity sector. The longer the reporting gap continues, the more difficult it becomes for stakeholders to obtain a current and independently audited assessment of the company. New Leadership Faces A Key Test The appointment of Syed Taha and Shaheryar Chishty created expectations of stronger operational and financial management at K-Electric. The unresolved FY2025 accounts now represent an immediate test for the new leadership. Clearing the backlog would give investors greater visibility into the company’s financial condition and allow K-Electric to move forward with greater transparency. It could also help rebuild confidence among shareholders and other financial stakeholders. K-Electric Needs To Close Its Reporting Gap More than a year after the end of FY2025, K-Electric’s audited financial results remain unavailable. The delay began amid uncertainty surrounding NEPRA proceedings but has continued despite a subsequent PSX deadline and a major change in the company’s leadership. For investors, the issue is no longer simply about a delayed annual report. It is about transparency, regulatory compliance and confidence in one of Pakistan’s most important power companies. The key question now is whether Syed Taha’s new management team will prioritise clearing the financial reporting backlog and provide stakeholders with a complete and audited picture of K-Electric’s financial position. Until that happens, investors remain dependent on outdated financial information while the company continues to operate under heightened scrutiny.

Pakistan Power Sector Circular Debt Reaches Rs1.68 Trillion as K-Electric Arrears Surge
Pakistan

Pakistan Power Sector Circular Debt Reaches Rs1.68 Trillion as K-Electric Arrears Surge

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Pakistan’s power sector circular debt reached Rs1.68 trillion by June 2026, highlighting the persistent financial weakness of the country’s electricity system despite a significant improvement in power sector under-recoveries. The latest data compiled by Arif Habib Limited Research and the Ministry of Energy Power show that circular debt increased by Rs61 billion during FY26. This marks a sharp reversal from FY25, when the government managed to reduce the stock by Rs780 billion. The increase is particularly concerning because the improvement in several components of the power sector was overshadowed by growing payment problems involving distribution companies and K-Electric. Power Sector Circular Debt Rises Despite Lower Under-Recoveries The total circular debt stood at approximately Rs1.675 trillion in June 2026, compared with Rs1.614 trillion a year earlier, representing a year-on-year increase of about 4 percent. Payables to power producers actually declined from Rs861 billion to Rs784 billion, while GENCOs’ liabilities to fuel suppliers slipped from Rs93 billion to Rs90 billion. However, the structure of the debt has changed dramatically. The amount previously parked with Power Holding Limited was removed from the reported liability structure after the government introduced a new Rs694 billion circular debt financing line in December 2025. Around Rs660 billion that had previously been held through PHL was reclassified as bank financing. By June 2026, Rs129 billion of this financing had been repaid. This accounting shift is important because the headline circular debt number does not tell the entire story. Part of the financial pressure has effectively moved from one balance sheet mechanism to another rather than disappearing. K-Electric Non-Payment Becomes a Major Warning Sign One of the most alarming developments in the latest circular debt data is the sharp increase in K-Electric’s non-payment. K-Electric’s unpaid amount contributed Rs194 billion to the FY26 circular debt build-up, compared with only Rs4 billion in the previous year. That represents a dramatic deterioration and deserves closer scrutiny from policymakers and regulators. The issue is not merely the size of the unpaid amount. It also raises questions about payment discipline across the power market. If large entities can accumulate substantial liabilities without timely settlement, efforts to control circular debt elsewhere in the electricity chain become significantly harder. DISCO Inefficiency Continues to Drain the Power Sector Distribution companies remained another major source of pressure. DISCO inefficiencies contributed Rs262 billion to the circular debt increase during FY26, broadly comparable with Rs265 billion recorded a year earlier. Although this figure was relatively stable, it remains unacceptably large. The data suggests that Pakistan’s circular debt problem is not simply a financing issue. It is also an operational problem involving electricity losses, weak collections, inefficient distribution networks and persistent gaps between the cost of supplying electricity and the amount recovered from consumers. DISCO under-recoveries, however, showed meaningful improvement. They declined to Rs64 billion from Rs132 billion a year earlier. This improvement indicates that tariff recovery and collection measures may be producing results. But the gains were not large enough to offset other sources of debt accumulation. Government Payments Provide Only Temporary Relief The government made Rs302 billion in stock payments to independent power producers during FY26. These payments provided the only major offset against the year’s gross circular debt build-up. The gross increase in liabilities reached Rs364 billion, compared with only Rs45 billion during the previous year. After accounting for the Rs302 billion in payments, the circular debt still increased by Rs61 billion. This exposes the central weakness in the government’s strategy. Large cash injections can reduce accumulated liabilities, but they do not permanently resolve the structural causes of circular debt. Other factors also influenced the final number. Prior-year recoveries and other adjustments added Rs75 billion, while unbudgeted or unclaimed subsidies reduced the build-up by Rs98 billion. Interest charges on PHL and IPP debt added Rs14 billion, while principal repayments reduced the increase by Rs129 billion. Pending generation costs related to quarterly tariff adjustments and fuel cost adjustments provided another Rs20 billion reduction. Circular Debt Problem Needs Structural Reform The latest figures should not be viewed as a simple improvement or deterioration story. Pakistan has achieved progress in reducing under-recoveries and lowering some outstanding payments to power producers. Yet the overall circular debt stock remains extremely high, while new liabilities continue to emerge. The sharp rise in K-Electric’s unpaid obligations is particularly significant. At the same time, continued DISCO inefficiencies show that the underlying distribution problem remains unresolved. The government’s decision to refinance liabilities at lower rates, including the requirement to refinance amounts parked in PHL at KIBOR minus 0.9 percent, could reduce financing costs. However, cheaper borrowing cannot substitute for better governance, stronger collections, lower electricity losses and transparent settlement mechanisms. Pakistan’s power sector circular debt will remain a recurring economic threat unless reforms focus on the causes rather than repeatedly financing the consequences. What the Rs1.68 Trillion Debt Means for Consumers The consequences ultimately extend beyond government accounts and power companies. Persistent circular debt can increase pressure for higher tariffs, additional subsidies, delayed payments to generators and greater borrowing by the public sector. Consumers can therefore end up paying indirectly for inefficiencies elsewhere in the electricity chain. The June 2026 figures offer a mixed picture. Under-recoveries have improved and payments to IPPs have increased, but the overall debt stock continues to rise. For Pakistan, the real test is no longer whether circular debt can be temporarily reduced. The bigger question is whether policymakers can stop new debt from accumulating in the first place.

Nishat Mills Exits Turkish Dairy JV at Rs5 Per Share Amid Industry Strain
Pakistan

Nishat Mills Exits Turkish Dairy JV at Rs5 Per Share Amid Industry Strain

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Nishat Mills Limited has decided to exit its dairy joint venture with Turkish partner Sütaş, citing difficult market conditions and regulatory challenges that have placed significant pressure on the business. The company’s Board of Directors, in an emergent meeting held in Lahore, approved the complete divestment of its 49.10% stake in Nishat Sutas Dairy Limited to its Turkish partner. The proposed transaction will allow Sütaş to take full ownership of the dairy venture, subject to the required shareholder approval and completion of other formalities. Why Is Nishat Mills Exiting the Dairy Business? Nishat Mills has pointed to the challenging operating environment facing Pakistan’s dairy industry as a key reason behind the decision. Rising input and energy costs, regulatory hurdles and weak returns have made it increasingly difficult for dairy businesses to maintain profitability. These pressures have also affected the financial position of Nishat Sutas Dairy. Rather than committing additional capital to an underperforming investment, Nishat Mills appears to be opting for an exit and redirecting resources toward areas with stronger strategic potential. The decision reflects a broader challenge for businesses operating in Pakistan’s food and agriculture sectors, where changing costs, pricing pressures and regulatory uncertainty can significantly affect investment returns. Nishat Sutas Dairy Stake to Be Sold at Rs5 Per Share One of the most notable aspects of the transaction is the proposed Rs5-per-share sale price. Nishat Mills plans to sell its entire 49.10% holding in Nishat Sutas Dairy to Sütaş at this price. The low valuation is likely to attract considerable attention from shareholders, particularly given the investment made in establishing and developing the joint venture. The proposed price raises an important question: does it represent fair value for an underperforming business, or does it reflect a distressed exit following prolonged financial pressure? The answer will depend on the dairy company’s financial position, accumulated losses, assets, future prospects and other commercial terms associated with the transaction. Turkish Partner Sütaş to Take Full Control Following the proposed divestment, Sütaş will become the sole owner of the dairy operation in Pakistan. The Turkish dairy company has agreed to acquire Nishat Mills’ stake and continue operating the plant. For Sütaş, acquiring the remaining stake provides an opportunity to take complete control of the business and determine its future strategy without the constraints of a joint-venture ownership structure. The continuation of the plant also suggests that the Turkish partner remains interested in maintaining a presence in Pakistan’s dairy market despite the sector’s current difficulties. However, the transaction also means that a venture originally established with a major Pakistani corporate group will move toward full Turkish ownership. Shareholders Still Need to Approve the Deal The proposed transaction is not yet final. Nishat Mills has scheduled an Extraordinary General Meeting (EOGM) for September 23, 2026, in Lahore, where shareholders will consider the proposed divestment. The company’s share books will remain closed from September 17 to September 23, 2026, for the purpose of determining shareholder eligibility for the meeting. The official disclosure states that the proposed transaction is in the best interest of Nishat Mills and its shareholders. The final outcome will therefore depend on shareholder approval as well as completion of the applicable regulatory and corporate requirements. What Does the Exit Mean for Nishat Mills? From Nishat Mills’ perspective, the divestment could be viewed as an exercise in capital discipline. Large diversified groups regularly reassess investments that fail to generate adequate returns. Exiting a non-core business can prevent further capital from being tied up in an underperforming asset. If the dairy venture has limited prospects of delivering attractive returns without substantial additional investment, selling the stake could allow Nishat Mills to concentrate on its stronger business areas. However, the Rs5-per-share sale price means investors will naturally examine whether the company has been able to recover a reasonable value from its investment. The transaction may therefore be interpreted in two different ways. Supporters could view the move as prudent capital allocation and an opportunity to stop further losses. Critics could argue that selling the stake at such a low price indicates that the joint venture failed to generate the returns originally expected. Pakistan’s Dairy Industry Under Pressure The Nishat Sutas development also highlights the wider difficulties facing Pakistan’s dairy industry. The sector has long faced challenges related to milk procurement costs, energy prices, inflation, processing expenses, consumer affordability and regulatory uncertainty. Dairy businesses must balance rising production costs with consumers’ limited ability to absorb higher prices. Energy costs are particularly important for large-scale dairy operations because refrigeration, processing, packaging and transportation all require significant power and fuel. When these costs rise faster than selling prices, profit margins can quickly come under pressure. The regulatory environment also remains an important consideration for investors. Changes in taxation, food standards, pricing policies and other regulations can influence the viability of long-term investments. A Warning Signal for Corporate Investment? Nishat Mills’ decision could also serve as a broader signal for investors considering Pakistan’s food-processing and agriculture-related industries. Pakistan has significant potential in dairy production because of its large livestock base and sizeable domestic consumer market. Yet transforming that potential into profitable large-scale businesses requires efficient supply chains, modern processing facilities, reliable energy supplies, competitive input costs and predictable regulations. The experience of Nishat Sutas Dairy demonstrates that strong market potential alone does not guarantee attractive investment returns. For corporate investors, the ability to manage operating costs and navigate regulatory conditions is becoming increasingly important. What Happens Next? The immediate next step is the shareholder vote scheduled for September 23, 2026. If shareholders approve the transaction and the remaining requirements are completed, Sütaş will acquire Nishat Mills’ entire 49.10% stake and take full control of Nishat Sutas Dairy. For Nishat Mills, the transaction could mark the end of its involvement in a difficult non-core investment. For Sütaş, it represents an opportunity to operate the Pakistani dairy business independently and determine whether restructuring or additional investment can improve its performance. Ultimately, the success of the exit should be judged not simply

Customs to Cut Physical Cargo Checks as Karachi Terminals Get More Scanners
Pakistan

Customs to Cut Physical Cargo Checks as Karachi Terminals Get More Scanners

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Karachi: Pakistan Customs is planning to rely more heavily on newly installed scanning facilities to reduce physical examination of cargo and speed up clearance at Karachi’s terminals. Chief Collector Customs Appraisement Wajid Ali, speaking at an interactive meeting with the Karachi Chamber of Commerce & Industry (KCCI), said scanners were specifically installed to minimise unnecessary physical inspections. Customs is coordinating with the Federal Board of Revenue (FBR) to ensure cargo is not subjected to repeated examinations where scanning facilities are available. Focus on Faster Cargo Clearance Wajid Ali said Customs would strengthen risk-management mechanisms to prevent cargo backlogs, particularly at the Karachi International Container Terminal (KICT). He stressed that closer coordination between Customs, terminal operators and the business community would be essential to improve cargo movement and reduce clearance delays. According to the Chief Collector, regular engagement with businesses helps authorities identify practical problems that may not become apparent through internal meetings or official directives. He added that resolving genuine operational issues quickly would benefit businesses while also improving clearance times, revenue collection and overall trade facilitation. Customs Considers Defined Processing Timelines The meeting also discussed the need for clearly defined timelines and measurable performance benchmarks for Customs procedures. Wajid Ali acknowledged that businesses are generally required to meet statutory deadlines, while corresponding timelines are not always established for processes where companies are waiting for action from Customs. He agreed that introducing clearer timelines should be considered at the policy level and could provide businesses with greater predictability. ADR Mechanism to Be Strengthened On the Alternative Dispute Resolution Committee (ADRC), Wajid Ali said amendments had been made to the relevant law and that a broader committee had been constituted under the leadership of a retired judge. The committee includes representatives from both Customs and the business community. He emphasised the need to make the mechanism fully operational so that disputes can be resolved more quickly and businesses can avoid lengthy litigation. Business Community Calls for More Automation Former KCCI President Zubair Motiwala welcomed the Customs leadership’s responsiveness but stressed that greater automation and clearly defined timelines were necessary to remove remaining bottlenecks. He particularly called for modernising the duty-calculation process, arguing that routine calculations should be handled through automated systems instead of requiring repeated approvals and unnecessary human intervention. According to Motiwala, greater automation could reduce processing times, minimise human errors and give businesses more certainty. He also welcomed the Green Channel mechanism and urged Customs to further expand technology-based facilitation for compliant businesses. KCCI Seeks More Customs Officers KCCI President Rehan Hanif also called for an increase in the number of Additional Collectors of Customs (ADCs). He said the shortage of ADCs was increasing the workload on existing officers and sometimes required businesses to approach senior officials for matters that could otherwise be handled at the ADC level. Hanif also suggested that examination assignments should be completed without unnecessary disruption when Customs officers are transferred or rotated. He proposed that once an examination is assigned, it should preferably be completed by the same officer or formally handed over to another officer to maintain continuity. More Transparency in Classification Decisions KCCI also urged Customs to upload Classification Committee decisions online on a timely basis. Making these decisions readily available could improve transparency and provide businesses with greater certainty when determining the appropriate classification of imported goods. The chamber also called for the ADRC to become fully operational with suitable representation from Customs and the business community. Calls to Restore Small-Vessel Export Operations Rehan Hanif further requested reconsideration of the discontinuation of small-vessel and launch operations for exports. He argued that such vessels could provide an alternative logistics channel during potential regional disruptions affecting conventional maritime operations. The discussions reflect a broader push by Pakistan’s business community for greater automation, faster customs clearance, predictable procedures and technology-driven trade facilitation at Karachi’s major terminals.

Pakistan’s Textile Exports Hit Record $1.81 Billion in July 2026
Pakistan

Pakistan’s Textile Exports Hit Record $1.81 Billion in July 2026

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Pakistan’s textile sector has started FY27 with a record-breaking export performance, with textile exports reaching US$1.814 billion in July 2026, according to the latest Pakistan Bureau of Statistics data analysed by AKD Securities. Record Textile Exports in July The July 2026 figure is the highest monthly textile export value ever recorded by Pakistan, surpassing the previous peak of US$1.739 billion recorded in November 2021, April 2022 and January 2026. The increase becomes even more significant when compared with June 2026. Textile exports stood at US$1.267 billion in June, meaning July exports jumped by approximately 43% month-on-month. July’s performance was also substantially above the sector’s five-year monthly average of around US$1.48 billion, highlighting the strength of the latest export momentum. Global Demand Supports Textile Growth Pakistan’s textile industry has experienced stronger export readings in several months since late 2025, with some monthly figures crossing the US$1.6 billion mark. The latest surge suggests that the sector may have moved beyond previous export ceilings. Improved global demand and stronger price competitiveness appear to have contributed to the record performance. The development is particularly important for Pakistan because textiles remain one of the country’s largest sources of export earnings and foreign exchange. Strong Start to FY27 The record July figure provides an encouraging start to Pakistan’s FY27 export performance. Higher textile receipts can support the country’s external account, improve foreign-exchange availability and contribute to industrial activity. However, maintaining such a high monthly export level will be the bigger challenge. The coming months will show whether July’s performance represents a sustained structural improvement or a temporary surge. Further PBS data will also be important in determining whether the growth was broad-based across major textile categories, including garments, knitwear, bedwear, towels and cotton-based products. For Pakistan, sustaining export momentum will depend not only on international demand but also on energy costs, production competitiveness, exchange-rate conditions, trade facilitation and access to major global markets.

ADB Technical Assistance for Pakistan Exposes Governance Failures Blocking Investment
Pakistan

ADB Technical Assistance for Pakistan Exposes Governance Failures Blocking Investment

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The Asian Development Bank has proposed ADB technical assistance for Pakistan worth $750,000 US Dollars to address governance weaknesses, poor public financial management and institutional capacity gaps that continue to restrict investment and economic competitiveness. The proposal is significant because it identifies problems that Pakistan has struggled with for years despite repeated reform programmes, budget measures and institutional restructuring. The ADB says weak governance, regulatory uncertainty, fragmented oversight and limited institutional capacity are creating serious obstacles for both the public and private sectors. The proposed Supporting Public Sector Reform and Institutional Capacity in Pakistan facility will provide technical support for policy diagnostics, institutional assessments, project preparation and capacity building at federal and provincial levels. However, the relatively small financial size of the programme should not distract from the larger issue. Pakistan does not primarily suffer from a shortage of reform recommendations. It suffers from weak implementation, inconsistent enforcement and limited institutional accountability. Weak Public Financial Management Remains a Major Risk The ADB has highlighted Pakistan’s narrow tax base, rigid government expenditures and weak budget controls as major weaknesses in public financial management. These problems directly affect the government’s ability to collect revenue and spend public money efficiently. A narrow tax base forces the government to depend heavily on a limited number of taxpayers and indirect taxes, while rigid expenditures leave less room for productive development spending. The proposed ADB technical assistance for Pakistan will support diagnostic assessments and policy recommendations aimed at strengthening public financial management. The programme will also support institutional capacity building through training and engagement with key stakeholders. But technical advice alone will not solve Pakistan’s fiscal problems. The real test will be whether government institutions actually implement the recommendations and whether reforms survive political and administrative changes. Regulatory Uncertainty Continues to Frighten Private Investors The ADB has also identified complex regulations, weak enforcement, fragmented oversight and limited transparency as barriers to private investment. For businesses, unpredictable regulation can be almost as damaging as high taxes. Investors need to know that rules will remain stable, approvals will be transparent and contracts will be enforceable. Judicial delays add another layer of uncertainty. The ADB says delays in the legal system are weakening business confidence and increasing the cost of doing business. This criticism deserves serious attention. Pakistan frequently announces investment incentives while leaving investors to navigate complicated regulatory procedures, overlapping authorities and lengthy dispute resolution processes. Without institutional reform, investment promotion campaigns risk producing headlines rather than sustainable capital inflows. Balochistan Faces a More Serious Institutional Challenge The ADB has specifically highlighted Balochistan, where outdated systems and limited institutional capacity are undermining public financial management. The proposed programme will support efforts to improve PFM systems in the province while also strengthening federal financial management. The focus on Balochistan is important because weak provincial institutions can prevent development spending from producing meaningful economic results. Better systems for budgeting, procurement, monitoring and accountability could improve the effectiveness of public investment. Can ADB Assistance Deliver Real Reform The ADB technical assistance for Pakistan offers a useful opportunity to diagnose institutional weaknesses and prepare practical reforms. It will also support the development of the Trade and Logistics for Private Sector Competitiveness Project and strengthen the readiness of future ADB financed initiatives. Yet Pakistan should not confuse technical assistance with economic reform itself. The central challenge is implementation. Pakistan has produced countless policy reports and reform plans. What remains missing is consistent execution, institutional accountability and political commitment. If the proposed ADB support leads to measurable improvements in budgeting, taxation, regulation, procurement and institutional performance, its impact could extend far beyond the $750,000 dollar assistance package. If recommendations remain trapped in government files, however, the programme will become another example of Pakistan identifying problems it already knows how to describe but struggles to solve.

The Boardroom PK delivers trusted business news, analysis, and insights from Pakistan and beyond, keeping readers informed, inspired, and ahead in the evolving world of business and leadership.

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