Pakistan's first National Dredging Company formed
As per the details, the initiative aims to provide cost effective and long-term solutions for dredging requirements of Pakistani ports.
To commence operations, the company will undertake capital dredging of Port Qasim from October 2025.
By developing indigenous dredging capabilities, NDMS would pave the way for greater self-reliance, operational continuity and sustainable maritime growth, the statement said.
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Express Tribune
24 minutes ago
- Express Tribune
S&P upgrades credit rating to B-
Listen to article Standard & Poor's (S&P) credit rating agency on Thursday upgraded Pakistan's rating by a notch to B negative, which is better than the previous standing but still two positions below investment grade. The revision was made due to the implementation of reforms and a reduction in sovereign default risks. S&P Global Ratings raised Pakistan's long-term sovereign credit rating from CCC+ to B- after a gap of two and a half years, according to an announcement made by the agency, one of the three largest global credit rating firms. It also assigned a stable outlook to Pakistan. The upgrade improved Pakistan's credit standing from "very high credit risk, vulnerable to non-payment" to "highly speculative." Due to its junk rating, Pakistan was unable to issue international bonds in the last fiscal year to raise external debt. S&P stated that "the coalition government led by the Pakistan Muslim League-Nawaz (PML-N) party has so far demonstrated its ability to navigate the necessary reform implementation under the International Monetary Fund (IMF) programme without significant social unrest." The note underlined that the policymakers' willingness to maintain expenditure controls while making continued enhancements to the tax revenue base will be critical to meeting the remaining targets under the Extended Fund Facility (EFF). The Ministry of Finance has played a key role in staying aligned with the IMF programme, often taking criticism for tough decisions needed to complete the first programme review and align the federal budget with Fund requirements. The upgrade reflects S&P's view that Pakistan is now less reliant upon on favourable macroeconomic and financial conditions to meet its obligations. Pakistan has replenished its foreign exchange reserves over the past 12 months, and near-term default risks have declined. However, concerns remain over exchange rate management, prompting intervention by the military establishment to curb the reemergence of the grey market. S&P noted that the depreciation of the Pakistani rupee against the US dollar in recent years has contributed to stagnation in nominal GDP per capita. It stated that with rupee stability in the last fiscal year and rising real growth, GDP per capita is projected to exceed $2,000 by FY2027. The agency stressed that political stability and improved security are necessary for further upgrades. However, it expects political uncertainty to remain elevated due to a fragmented political environment. "Pakistani politics has been in a state of flux since the ouster of former Prime Minister Imran Khan of the Pakistan Tehreek-e-Insaf (PTI) party in a parliamentary no-confidence motion in April 2022." "We believe a stable political environment in Pakistan is an important precondition to further improvements in the government's creditworthiness." While security has improved since the early 2010s, the potential for deterioration remains, it added. Border tensions with India, as evident in the recent outbreak of hostilities in the wake of the Pahalgam terrorist attack in May 2025, can raise the spectre of miscalculations and accidental clashes that could escalate well beyond the intentions of both sides, according to S&P. Debt servicing also remains a significant concern for the ratings agency. S&P said that Pakistan's stable outlook reflects its expectation that external support from key multilateral and bilateral partners, along with fiscal improvement, will continue over the next 12 months to meet large debt obligations. It added that continued economic recovery and efforts to enhance revenue will stabilise Pakistan's fiscal and debt metrics. The country's current account posted a surplus in FY2025, the first in 14 years, amounting to 0.5% of GDP. The surplus was driven by record-high remittances of $39 billion, or 9.5% of GDP, according to the agency. These gains have improved Pakistan's external indicators and eased near-term financial pressure. Reforms under the IMF programme have also boosted tax revenues by 3% of GDP in the past year. Combined with spending controls, S&P projects the general government deficit will decline to 5.1% of GDP in FY2026, but still above the government's budgeted target. Inflation is expected to remain around 6.5% over the next two to three years. As a result, monetary conditions will ease further. With lower interest rates, interest payments are projected to fall to 41% of revenue over the next three years, down from over 60% in FY2024. "Nevertheless, Pakistan's interest servicing-to-revenue ratio remains one of the highest globally among rated sovereigns," the agency noted. It added that the country's high interest expenses remain the main constraint on debt sustainability. The debt-to-revenue ratio is projected to worsen from 443% to 454% in FY2025, according to the agency. Future warning "We may lower our ratings if Pakistan's external or fiscal indicators deteriorate well beyond their current levels," S&P warned. Downward pressure would emerge if financial support from key bilateral and multilateral partners quickly erodes, or usable foreign exchange reserves fall substantially to levels indicating difficulties in servicing its external debt obligations, it added. The agency added that should interest rates surge again and materially i add to the government's already-heavy debt servicing burden, we would view that as an indication of domestic financing stress, warned the agency.
Express Tribune
8 hours ago
- Express Tribune
S&P upgrades Pakistan's credit rating to 'B negative'
Listen to article Standard & Poor's credit rating agency upgraded Pakistan by one notch to "B negative" on Thursday, an improvement from its previous standing, though still two positions below investment grade. This move comes due to the implementation of reforms and the abating risks of sovereign default. S&P Global Ratings raised the long-term sovereign credit ratings from "CCC positive" to "B negative" after a gap of two and a half years, according to an announcement by the agency, one of the three largest credit rating firms. The agency also assigned a stable outlook to Pakistan. The upgrade has improved Pakistan's creditworthiness from 'very high credit risk, vulnerable to non-payment' to 'highly speculative.' Due to its junk credit rating, Pakistan was unable to float international bonds to raise more debt last fiscal year. S&P stated, 'The coalition government led by the Pakistan Muslim League-Nawaz (PML-N) has demonstrated its ability to implement necessary reforms under the IMF programme without significant social unrest.' The agency noted that the willingness of policymakers to adhere to expenditure controls and continue enhancing the tax revenue base will be crucial in meeting the remaining targets set out in the Extended Fund Facility (EFF) arrangement. The Ministry of Finance has played a key role in staying on track with the IMF programme, despite facing criticism for making tough decisions necessary to complete the first review of the programme and align the new budget with the Fund's requirements. S&P's ratings upgrade reflects the agency's view that Pakistan is less reliant on favourable macroeconomic and financial developments to meet its obligations. Pakistan has replenished its foreign reserves over the last 12 months, and near-term default risks have abated, according to S&P. However, one vulnerable area that emerged is related to the exchange rate, which has led to intervention by the military establishment to prevent the reemergence of the grey market. S&P highlighted that the Pakistani rupee's depreciation against the US dollar in recent years contributed to stagnation in the country's nominal GDP per capita. The agency noted that the rupee stabilised in the last fiscal year, and with rising real growth, it forecasts that GDP per capita will surpass $2,000 by fiscal year 2027. The rating agency also emphasised that political stability and improvement in security conditions are critical for further upgrades. However, it expects political uncertainty to remain high due to a volatile political environment. 'Pakistani politics has been in flux since the ousting of former Prime Minister Imran Khan through a parliamentary no-confidence motion in April 2022,' S&P noted. 'We believe that a stable political environment in Pakistan is a key precondition for improvements in the government's creditworthiness.' The security situation has improved since the early 2010s, but the potential for deterioration remains. Border tensions with India, highlighted by the recent outbreak of hostilities following the Pahalgam terrorist attack in May 2025, could escalate beyond the intentions of both sides, the agency warned. S&P also pointed out risks related to debt-servicing costs, which remain high. The agency said Pakistan's stable outlook reflects its expectation that external support from key multilateral and bilateral partners, along with improvements in the country's fiscal position, will persist over the next 12 months to meet considerable debt obligations. The outlook also reflects expectations that continued economic recovery and government efforts to enhance revenue will stabilise fiscal and debt metrics. Pakistan's current account posted a surplus in fiscal 2025, the first surplus in 14 years. The modest annual surplus of 0.5% of GDP was driven by record-high remittances, which totalled $39 billion, or 9.5% of GDP. These developments have strengthened Pakistan's external metrics and alleviated near-term external stress. The IMF programme-related reforms have significantly increased the government's tax revenues by 3% of GDP in the last 12 months. Alongside expenditure controls, S&P forecasts that the general government deficit will decrease to 5.1% of GDP in fiscal 2026, although this is higher than the government's budget target. The agency has projected inflation to stay around 6.5% over the next two to three years. As a result, monetary conditions will ease further, and with lower domestic interest rates, government interest payments will decrease to an average of 41% of revenue over the next three years, from a peak of over 60% in fiscal 2024. 'Nevertheless, Pakistan's interest-servicing-to-revenue ratio remains one of the highest globally among rated sovereigns,' S&P stated. 'The main pressure on debt sustainability is the extremely high interest expense relative to fiscal revenue.' This remains a significant constraint on the agency's assessment of Pakistan's debt burden. S&P sees further deterioration in the debt-to-revenue ratio, projecting it to increase from 443% to 454% in this fiscal year. Future warning: 'We may lower our ratings if Pakistan's external or fiscal indicators deteriorate well beyond their current levels,' S&P stated. Downward pressure would emerge if financial support from key bilateral and multilateral partners erodes quickly, or if usable foreign exchange reserves fall substantially, indicating difficulties in servicing external debt obligations. Furthermore, should interest rates surge again and substantially add to the government's already-heavy debt-servicing burden, the agency would view that as an indication of domestic financing stress, it added.
Express Tribune
10 hours ago
- Express Tribune
UBG Chief urges SBP to cut interest rate to 6pc
Listen to article S M Tanveer, Patron-in-Chief of the United Business Group (UBG), has called on the State Bank of Pakistan (SBP) to reduce the policy interest rate to 6 per cent, citing low inflation and the need to spur economic growth. In a statement issued on Thursday, Tanveer said the prevailing interest rate of 11pc is disproportionately high, especially given that the Consumer Price Index (CPI) stands at 0.3pc while average inflation is currently hovering around 4pc. He noted that the International Monetary Fund (IMF) recommends maintaining interest rates slightly above the inflation rate to keep them positive in real terms. "At 11pc, Pakistan's interest rate is far above the inflation rate, stifling industrial growth and increasing the cost of doing business," he said. Read More: Profit-taking pulls PSX down after strong opening With the monetary policy announcement due on July 30, Tanveer urged the central bank to consider a significant rate cut. He argued that such a move would reduce the government's interest payments, stimulate investment, and make Pakistani exports more competitive. He pointed out that the government has allocated Rs8.5 trillion for interest payments in the current budget. A cut in the interest rate to 6pc, he claimed, could save nearly Rs3.5 trillion. Highlighting the challenges faced by the business community, Tanveer also criticised certain fiscal measures in the recent budget. In particular, he expressed concern over Sections 37A and 37B of the Income Tax Ordinance, which grant tax authorities the power to arrest and detain. He urged the government to focus on creating a business-friendly environment, noting that high borrowing costs, coupled with soaring energy prices, are already weighing heavily on industry. Also Read: PM Shehbaz hails World Bank position on IWT Meanwhile, the SBP has maintained its policy rate at 11pc in recent months, citing inflationary pressures and vulnerabilities in the external sector. However, with inflation expected to stabilise around the long-term average of 7pc in the coming quarters, analysts believe there may be room for a cautious easing of monetary policy. The external account outlook has improved, buoyed by strong inflows of workers' remittances, and foreign exchange reserves are projected to rise beyond $13 billion by June 2025 — developments that may provide the SBP with greater policy flexibility.
