Latest news with #Sukuk
Business Recorder
2 days ago
- Business
- Business Recorder
BMR initiative to spur SPL business revival
KARACHI: Sitara Peroxide Limited (SPL), the Faisalabad-based chemical manufacturer, continues to battle financial headwinds, posting a net loss of Rs 76.37 million in the half year ended December 31, 2023. However, the company's management remains cautiously optimistic about its future, banking heavily on a comprehensive Balancing, Modernization, and Replacement (BMR) initiative aimed at transforming the struggling enterprise into a viable and efficient operation. As per the company's correspondence to Pakistan Stock Exchange in its Half Yearly Report of 2023, SPL's financials reveal a sharp decline in net sales, plummeting to just Rs 14.9 million during the half-year, compared to Rs 385.7 million in the same period a year earlier. The drastic fall is primarily attributed to the plant's shutdown, which has remained non-operational since June 12, 2023. Despite this, the company managed to narrow its losses from Rs 220 million last year to Rs 76.37 million, aided by reduced depreciation and a one-time gain of Rs 84.8 million from the sale of non-current assets. The gross loss stood at Rs 77.5 million, slightly improved from Rs 112.8 million a year ago. The loss per share also shrank from Rs 3.99 to Rs 1.39. However, liquidity pressures persist—current liabilities exceed current assets by an staggering Rs 834 million, and the firm remains unable to meet debt obligations on time. In a bid to reverse the fortunes, SPL has pinned its revival strategy on a multi-pronged BMR (balancing, modernization and replacement) initiative, which includes a transition to modern slurry bed catalyst technology from the outdated fixed bed system. This upgrade is projected to enhance annual production capacity from 30,000 to 40,000 tons, improve yield efficiency, and significantly reduce costs. The company has already entered negotiations with international technology and equipment suppliers and made initial advance payments to that effect. SPL CEO Imran Ghafoor stated that the management aims to 'make the company debt-free and competitive in the long run,' while acknowledging the current economic uncertainties. He also disclosed a rescheduling of a Rs 167 million Sukuk facility, with Rs 296.7 million in accrued markup potentially being waived—conditional upon timely payments under new terms. To finance the BMR, the sponsors plan to inject Rs 355 million by selling assets from an associated company, in addition to seeking fresh bank loans. The management emphasizes that resuming operations under the current obsolete setup, combined with high RLNG and power tariffs would lead to 'unsustainable operational losses.' Therefore, the transition through BMR is being pursued not only as a revival strategy but as an existential necessity. Despite its current struggles, the board has reaffirmed its commitment to long-term sustainability, thanking stakeholders for their continued patience. Copyright Business Recorder, 2025
Zawya
2 days ago
- Business
- Zawya
The IILM's USD800mln short-term Ṣukūk oversubscribed by 2.3 times
Kuala Lumpur, Malaysia. The International Islamic Liquidity Management Corporation (IILM), an international organisation that develops and issues short-term Shari'ah-compliant financial instruments, has successfully completed the reissuance of an aggregate USD 800 million short-term Ṣukūk across three different tenors of two-week, three-month, and six-month respectively. The three series were priced competitively at: 4.40% for USD 305 million for 2-week tenor; 4.49% for USD 355 million for 3-month tenor; and, 4.38% for USD 140 million for 6-month tenor Today's successful completion of the short-term Ṣukūk transaction marks the IILM's thirteenth auction year-to-date with a cumulative issuance of USD 13.15 billion, across 39 Ṣukūk series of varying tenors. The auction attracted robust participation from the IILM's network of Primary Dealers and global investors, generating total bids of USD 1.9 billion and achieving a strong average bid-to-cover ratio of 2.3 times. Mohamad Safri Shahul Hamid, Chief Executive Officer of the IILM, commented: 'Today's auction outcome underscores the continued strength of investor demand for high-quality Islamic liquidity instruments, despite ongoing uncertainty surrounding the US Federal Reserve's rate trajectory and broader shifts in global monetary policy. Market participants remain cautious as central banks weigh persistent inflationary pressures against signs of moderating economic growth. 'The IILM's consistent ability to attract strong participation across all tenors reflects the market's confidence in our Ṣukūk programme as a dependable tool for short-term liquidity management. As global financial conditions remain uneven, the role of stable and Shari'ah-compliant instruments such as ours will become increasingly vital.' The issuance forms part of the IILM's 'A-1' (S&P) and 'F1' (Fitch Ratings) rated USD 6 billion short-term Ṣukūk issuance programme. The IILM's short-term Sukῡk is distributed by a diversified and growing network of primary dealers globally, namely Abu Dhabi Islamic Bank, Al Baraka Turk, Affin Islamic Bank, AlRayan Bank, Boubyan Bank, CIMB Islamic Bank Berhad, Dukhan Bank, First Abu Dhabi Bank, Golden Global Investment Bank, Kuwait Finance House, Kuwait International Bank, Maybank Islamic Berhad, Meethaq Islamic Banking from Bank Muscat, Qatar Islamic Bank, and Standard Chartered Bank. The IILM is a regular issuer of short-term Ṣukūk across varying tenors and amounts to cater to the liquidity needs of institutions offering Islamic financial services. The IILM will continue to reissue its short-term liquidity instruments monthly as scheduled in its issuance calendar. About the IILM The International Islamic Liquidity Management Corporation (IILM) is an international organisation established on 25 October 2010 by central banks, monetary authorities and multilateral organisations to develop and issue short-term Shari'ah-compliant financial instruments to facilitate effective cross-border liquidity management for institutions that offer Islamic financial services (IIFS). The current members of the IILM Governing Board are the central banks and monetary agencies of Indonesia, Kuwait, Malaysia, Mauritius, Nigeria, Qatar, Türkiye, the United Arab Emirates, as well as the multilateral Islamic Corporation for the Development of the Private Sector. Membership of the IILM is open to central banks, monetary authorities, financial regulatory authorities or government ministries or agencies that have regulatory oversight of finance or trade and commerce, and multilateral organisations. The IILM is hosted by Malaysia and headquartered in Kuala Lumpur.
Business Recorder
3 days ago
- Business
- Business Recorder
Pakistan's first ‘agri Sukuk' launched
KARACHI: In a major development for Islamic finance and agricultural infrastructure, InfraZamin Pakistan, Sunridge Foods (Pvt) Limited and BankIslami Pakistan marked the launch of the country's first agri-infrastructure Sukuk with a ceremonial gong-striking at the Pakistan Stock Exchange (PSX). The fully subscribed Rs 2 billion Sukuk marks a pioneering milestone in Shariah-compliant, climate-resilient financing for Pakistan's agriculture sector. Structured under a robust governance framework, the Sukuk is backed by a 100 percent principal credit guarantee from InfraZamin Pakistan and has received a long-term AAA rating from VIS Credit Rating Company. InfraZamin, Sunridge Foods ink deal for Rs2bn Sukuk Institutional investors led the subscription, highlighting growing confidence in innovative Islamic finance instruments for infrastructure and development. BankIslami Pakistan acted as the Mandated Lead Arranger, while AKD Securities served as Financial Advisor. Al-Hilal Shariah Advisors ensured Shariah compliance, and Pak Brunei Investment Company Limited was appointed as Investment Agent and Trustee. The funds raised through the Sukuk will finance Sunridge Foods' Balancing, Modernization, and Replacement (BMR) projects. These include the installation of 1 MW wind turbines and a 0.5 MW solar power plant to reduce carbon emissions, as well as the construction of silos and warehouses to expand food storage capacity. A significant portion will also provide working capital support to Sunridge's wheat and rice processing units in Karachi and Lahore—facilitating enhanced production of essential staple foods. Analysts noted that The Sukuk launch represents a critical step in aligning Pakistan's capital markets with sustainable infrastructure development, climate goals, and food security priorities, reinforcing the role of Islamic finance in shaping an inclusive economic future. Chief Guest, Deputy British High Commissioner Lance Domm hailed the Sukuk as a significant step toward climate-resilient and sustainable economic growth. 'This transaction demonstrates how partnerships can mobilize private investment for development,' he noted, reaffirming the UK's commitment to support Pakistan's financial ecosystem through its collaboration with InfraZamin and others. InfraZamin CEO Maheen Rahman described the issuance as a transformative example of how credit guarantees can unlock access to capital markets for critical sectors like agriculture. 'We are committed to enabling long-term, sustainable financing solutions that support Pakistan's food security and economic resilience,' she said. Amir Shahzad, Chairman and Executive Director of Sunridge Foods, said the initiative would allow the company to modernize its operations and enhance renewable energy use. 'This Sukuk not only boosts our capacity but also strengthens Pakistan's food systems through sustainable and inclusive growth,' he stated. BankIslami CEO Rizwan Ata emphasized the growing relevance of Islamic finance in addressing development challenges. 'This Agri-Infrastructure Sukuk showcases the potential of Shariah-compliant instruments to channel capital toward national priorities,' he said. PSX Chairperson Dr. Shamshad Akhtar underscored that Pakistan's dual crises of climate change and food insecurity required bold, homegrown financial solutions. She termed the Sukuk a prime example of private sector innovation meeting public need. PSX CEO Farrukh Subzwari added that PSX is committed to fostering a sustainable finance ecosystem, calling on banks, fund managers, regulators, and corporates to collaborate on future initiatives that combine financial innovation with national development. Copyright Business Recorder, 2025
The Hindu
3 days ago
- Business
- The Hindu
Modi's Maldives Visit Aims to Reset Fractured Ties
Published : Jul 21, 2025 15:36 IST - 5 MINS READ Prime Minister Narendra Modi's visit to the Maldives, scheduled for July 25-26, after he wraps up his UK visit, signals a reset in India-Maldives ties, and demonstrates, yet again, the demands of practical geopolitical urgencies overtaking pre-election rhetoric on both sides. For Maldivian President Mohamed Muizzu, Modi's visit will help ward off criticism that he is dithering in the face of an economic crisis afflicting the country. On July 3, the main opposition party, the Maldivian Democratic Party (MDP), said: 'Inflation continues to rise, fiscal transparency has been rolled back, and debt vulnerabilities are worsening. The looming Sukuk [bond] repayment remains unresolved, with no credible refinancing strategy in place.' Debt crisis The repayment the MDP referred to is an amount of $600 million due this year and another $1 billion due in 2026. Public debt has reached over 134 per cent of the country's gross domestic product. Pressing the panic button at the last possible moment, the Muizzu government has adopted a series of austerity measures, including terminating political appointments, but this has not made even a dent on the debt situation. During his October 2024 visit to India, Muizzu, who was seen as the anti-India candidate ahead of the 2023 presidential election, made a case for financial aid. Despite its displeasure, India provided a currency swap for about $750 million and rolled over $50 million in credit. Even with all this, the Maldives is very close to defaulting on its repayment commitments without significant support from its international partners. Modi's visit is important to keep Indian interests alive in the neighbourhood, since China is making attempts to forge a regional grouping that replaces the defunct South Asian Association for Regional Cooperation (SAARC) and the sometimes-functional Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC). SAARC has been in limbo since India refused to attend the 19th summit in Islamabad in 2016. BIMSTEC, an idea brought to life when I.K. Gujral was Prime Minister in 1997, is stuttering, partly because of the reigning distrust in India-Bangladesh relations. On June 19 this year, China held a tri-lateral conclave with Bangladesh and Pakistan in Kunming to bring in better synergy in their coordinated working. Separately, it has pursued rulers in both Nepal and Bhutan over the past decade. This has manifested in China flexing its muscle in some places where it shares a border with India, notably Doklam in 2017, and other points along the Line of Actual Control. Also Read | Is Maldives President Muizzu softening his stance on Indian troops? Muizzu and India Muizzu's first act as President was to demand the recall of Indian military personnel stationed in the Maldives. The personnel were there as part of an agreement whereby India was to operate and maintain aviation platforms for humanitarian needs. This led to a stand-off between the two countries, but India withdrew its military personnel and replaced them with civilians. The next fracas came in January 2024, when Modi promoted Lakshadweep during a visit by comparing it with the Maldives. An online storm ensued, and relations between the two countries went south. Muizzu visited China the very next day and signed deals. Also, contrary to established tradition, Muizzu refused to visit New Delhi in his first official trip as President, choosing Türkiye instead. While these moves catered to his domestic base, it did not help the Maldivian economy, which is deeply tied to India. The Maldives, an archipelago nation of over 1,200 islands, depends on India for its daily needs, including fruits and vegetables, and goods such as granite, cement, and other construction materials. Maldivian tourism In the 2024 souring of India-Maldives relations, a few Indian businesses such as the travel portal EaseMyTrip also played a role. In the middle of the spat, the company, which likes to call itself 'Bharat ka Travel App,' led an unprecedented, company-level 'Boycott Maldives campaign' and unilaterally halted bookings to the Maldives. Nishant Pitti, founder and chairman of EaseMyTrip, posted on X on January 8, 2024: 'In solidarity with our nation, @EaseMyTrip has suspended all Maldives flight bookings.' Pitti's post was viewed more than 4 million times. He tagged, among others, the Prime Minister's Office as well as Narendra Modi, in his post. In another post, he said: 'Say no to Maldives bookings and explore the wonders of Ayodhya and Lakshadweep.' This online drama, which many consider as having added fuel to the India-Maldives tension, took place during the build-up to the 2024 Lok Sabha election. After the election, however, South Block sought to repair relations with the country's neighbour. External Affairs Minister S. Jaishankar visited the Maldives in August 2024 and spoke about how Maldivians could benefit from a collective of India-Maldives projects and coined the catchy phrase 'imagined by Maldives, delivered by India'. Pitti now saw an opportunity to back down from his earlier 'nationalistic' position. He said: 'Basis positive developments in mending India-Maldives bilateral ties, by both governments, we are resuming bookings to the Maldives... Being a nation-first company, we are always in alignment with our government and support their vision.' Since social media thrives on controversy, this conciliatory post was barely seen by 9,000 users. Also Read | India-Maldives row: Is social media driving foreign policy? Restoring ties A lot has changed since then, with officials and diplomats working overtime to find common points of interest. About the upcoming visit, the Maldivian President's office announced on July 20: 'This is Prime Minister Modi's first visit to the Maldives, since assuming his third term. During this visit, President Dr. Muizzu and Prime Minister Modi will hold high-level discussions on key bilateral and regional issues, followed by the inauguration of several joint projects and the exchange of a number of Memoranda of Understanding aimed at deepening cooperation across various sectors of mutual interest. This visit carries profound significance as it coincides with the 60th anniversary of Maldives' independence and the 60th anniversary of the establishment of diplomatic relations between the Maldives and India.' The invitation itself was accepted by Modi in October 2024, after Muizzu's visit to India led to an improvement in relations between both countries. The July 20 announcement by the Ministry of External Affairs pointed out that this would be the 'Prime Minister's third visit to Maldives, and the first visit by a Head of State or Government to Maldives during the Presidency of H.E. Dr. Mohamed Muizzu'. It added that the visit 'reflects the importance India attaches to its maritime neighbour'.
Express Tribune
4 days ago
- Business
- Express Tribune
Are stabilisation measures backfiring?
Under the emerging situation, the people are facing unemployment and underemployment and this scenario is grave from the socio-political point of view. photo: file Listen to article The stabilisation measures have impacted the real economy a great deal. The market economy has been growing slowly, as indicated by the statistics of GDP. The current account surplus from July to May 2025 remained around $1.8 billion. This surplus has been achieved at the expense of imports, where deliberate attempts have been made to scale down imports in the last couple of years. In addition, remittances of around $38 billion also helped in achieving the surplus. The massive import compression, started in FY2023 to stabilise the economy, has produced results. This compression played an important role in bolstering the foreign exchange reserves held by the State Bank of Pakistan (SBP), which have crossed $14 billion. If the economy operates at the current level, foreign exchange reserves will cover around 2.5 months of merchandise imports, since imports remained around $58 billion in FY2025. Apart from rollover of commercial loans from China, the SBP intervened in the foreign exchange market to fulfil the target of foreign exchange reserves agreed with the International Monetary Fund (IMF). On the monetary front, the SBP has kept the policy rate at 11% to attract international financial capital. This high rate will attract hot money to finance the current account in the event it turns into deficit. The growth in imports is linked with the growth in the real economy, which will turn the current account surplus into a deficit. As the level of aggregate demand is low, business firms cannot sell their products to consumers. Furthermore, the level of aggregate demand remained low owing to regressive taxation and high energy costs. The gas prices have been revised upward in FY2026, while electricity prices are already at an elevated level. The higher international crude oil prices have started to affect the masses. The salaried class has paid around Rs550 billion in income tax in FY2025, and the tally would remain around this level in the current financial year. All these measures have reduced the purchasing power of consumers. Many firms have invested in treasury bills, bonds, and Sukuk, since these firms intend to remain liquid. A whopping Rs13.5 trillion has been parked by the corporate sector in bills, bonds, and Sukuk till December 2024. Business firms did not enhance investment in the capital development of the country. As a result, the index of the Large-Scale Manufacturing sector has decelerated by 1.2% in the eleven months of FY2025. The government did spend around Rs1,050 billion through the Public Sector Development Programme (PSDP) in FY2025. The tight-fisted Ministry of Finance (MoF) allowed the release of a large chunk of the budgeted funds in the last quarter. The development funds have been diverted from development projects to meet the primary budget surplus. The tight fiscal and monetary policies have also reduced the level of economic activity a great deal. The high debt servicing cost has further reduced the fiscal space of the government. Under the Extended Fund Facility (EFF), the government intends to bring down the fiscal deficit to around 6%. This reduction in the fiscal deficit can be achieved by scaling down development expenditure. The impact of low development expenditure has already affected the cement, steel, glass, and allied manufacturing sub-sectors. In addition, the construction sector remained dull in the outgoing financial year. In a nutshell, stabilisation measures have started to implicate the masses a great deal. Under the emerging situation, the people are facing unemployment and underemployment. The level of unemployment is high for university graduates. This situation is grave from the socio-political point of view. Will policymakers take stock of the situation? THE WRITER IS AN INDEPENDENT ECONOMIST
