Pakistan's sole PVC resin manufacturer eyes 'big opportunity' to supply construction materials to NEOM

https://arab.news/zcc7n

KARACHI: Engro Polymer and Chemicals Limited (EPCL), Pakistan's sole manufacturer of PVC resin material, said on Wednesday it is eyeing supply of the product for construction at Saudi Arabia's planned smart city NEOM which can help it earn $300 million in exports.

Neom, a $500 billion project, is a key element of the Saudi Vision 2030 plan as part of the kingdom's mission to diversify away from its oil-dependent economy. The project is estimated to create 380,000 jobs and contribute SAR180 billion to Kingdom's GDP. Saudi Arabia's flagship business and tourism development project at the Red Sea coast is expected to see massive construction in the coming months and years.

Polyvinyl chloride (PVC) resin is the raw material used to manufacture various construction materials. These include PVC pipes, Wood Plastic Composite (WPC) windows and furniture, Stone Plastic Composite (SPC) flooring, and cable insulation. PVC is also used to manufacture medical equipment.

"A big opportunity is knocking at the door in the form of Neom," Muhammad Farhan, general manager downstream business and market development at EPCL, told Arab News. Farhan was speaking at a media briefing at the Bin Qasim industrial zone in Pakistan's southern port city of Karachi.

"Neom is a $500 billion project that requires massive construction materials including PVC downstream products that are available in Pakistan," Farhan added.

"In fact, some of the Pakistani manufacturers have already bid for the supply of material to the kingdom."

Farhan said Pakistani manufacturers of PVC products had received overwhelming response from Saudi participants of the Big 5, a mega construction show held in Dubai in December 2022.

He said Saudis are exploring different options while manufacturers in the kingdom are looking for other manufacturers who can make products for them.

The EPCL official said the demand for the basic construction material, including cables and pipes, will increase in the first phase of construction at Neom and will keep booming for at least two years. Simultaneously, demand for value-added products for construction on the exterior, including SPC and WPC, will increase.

To take greater advantage of Neom's lucrative opportunities, Farhan said the government can play a vital role by engaging Saudi authorities and the Trade Development Authority of Pakistan (TDAP).

"We saw the interest of the Saudi participants in the value-added products – they want to import but they were also looking for investment in the kingdom for manufacturing and as a nation, we have access capacity and by utilizing that capacity we can avail the opportunity," he added.

Muhammad Idrees, EPCL's chief commercial officer, said the country is already exporting PVC resin to Gulf countries UAE. Bahrain, Oman, and Egypt because of the freight advantage.

"Engro has installed capacity of 300,000-ton resin production while the downstream industry has close to a million-ton capacity," Idrees said.

"The downstream PVC industry can fully utilize its excess capacity and earn $300 million in terms of export revenue by standardizing and improving the quality of finished products."

He said the $300 million PVC export potential could materialize within the next three to four years by the value-added industry through the export of surplus volumes and products.

Idrees said EPCL is collaborating with TDAP to explore global markets to export value-added PVC downstream products.

"In the last two years, the company exported surplus products worth $48 million to Turkiye and Middle Eastern markets, while import substitution of around $300 million contributed significantly toward solving Pakistan's balance of payments situation," he added.

Mahmood Siddiqui, vice president of manufacturing at EPCL, said the company has invested over $188 million since 2015 in plant expansion and other upgrade projects for higher efficiency, reliability, and diversification of operations.

Pakistan's per capita PVC consumption stands at 1.2 kg versus a global average of 6.1 kg. Per capita consumption growth, EPCL officials said, would be driven by rising per capita income, increasing urbanization, and robust domestic manufacturing in the coming years.

However, they said the company was facing challenges of importing equipment for additional plants as commercial banks refuse to open Letters of Credit (LCs) as Pakistan faces a dollar crunch amid a worsening economic crisis.

QUETTA, Pakistan: Pakistani police on Wednesday formally named former Prime Minister Imran Khan in connection with the murder by unknown gunmen of a lawyer seeking sedition proceedings against him.

Police registered an "abetment to murder" case against former cricket hero Khan, 70, who faces dozens of charges since his ouster in a parliamentary vote of confidence in April last year.

Khan, who has not been charged in connection with the lawyer's murder, has dismissed all the cases against him as concocted by his opponents.

In a live online broadcast, Khan denied the allegations adding that he would appear in court on Thursday to seek bail for 16 other cases.

Provincial government spokesman Babar Khan said Khan could face formal charges if and when the murder case goes to trial.

Abdur Razaq, the murdered lawyer, had filed a court petition seeking sedition proceedings against Khan for dissolving his government after the no-confidence motion.

Razaq was on his way to court on Tuesday when gunmen on a motorcycle shot and killed him, police said.

Razaq's son, Siraj Ahmad, also a lawyer, told police that his father had been killed by unknown men with the "abetment of the former prime minister", according to a police report filed by him and seen by Reuters.

It was not immediately clear how the link between unknown gunmen and Khan was made.

Last week, Khan was released on bail on terrorism charges of abetting violence against the military by his protesting supporters after he was arrested and detained on May 9 in a corruption case.

The embattled Khan is embroiled in a confrontation with the powerful military, which has ruled Pakistan directly or overseen civilian governments throughout its history.

His May 9 arrest sparked widespread protests by his supporters who ransacked military facilities, raising new worries about the stability of the nuclear-armed South Asian nation as it struggles with its worst economic crisis in decades.

Khan has appealed for talks to end the standoff with the military. The government has rejected his call and the military has said enactors and masterminds of the May 9 violence would be tried under army laws.

Khan has accused the military and its intelligence agency of openly trying to destroy his party, saying he has "no doubt" he will be tried in a military court and thrown into jail. The military has said it is not behind a crackdown on political activities.

ISLAMABAD: China, Pakistan and Iran held their first trilateral meeting on counter-terrorism in Beijing on Wednesday, the Pakistani foreign ministry said in a statement.

The delegations held detailed discussions on the regional security situation, particularly the threat of terrorism faced by the region.

"Based on the outcome of these consultations, they decided to institutionalize the Trilateral Consultations on counter terrorism and security for which further details will be worked out," the Pakistani FO said.

A statement by the Chinese foreign ministry said the three countries had "in-depth" exchanges on the regional counter-terrorism situation, and decided to hold the meeting on a regular basis.

Abdul Hameed, director general of counter terrorism at the Ministry of Foreign Affairs, led Pakistan's delegation while the Chinese delegation was headed by Bai Tian, director general of the Department of External Security Affairs at the Chinese foreign ministry. The Iranian delegation was led by assistant to the Iranian foreign minister, Seyed Rasoul Mosavi.

The FO said Hameed and Mosavi also called on Assistant Foreign Minister of China Nong Rong.

Last month, Pakistan had also held trilateral talks with China and Afghanistan in Islamabad.

ISLAMABAD: Pakistan has decided to appoint a senior official to resolve issues related to the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project, whose construction has remained stalled for years, the petroleum ministry said on Wednesday.

The pipeline will link the energy-rich Central Asian country of Turkmenistan through Afghanistan to Pakistan and India, and is expected to carry 33 billion cubic meters (bcm) of natural gas each year along a route stretching 1,800 km (1,125 miles) from Galkynysh, the world's second-biggest gas field, to the Indian city of Fazilka near the Pakistan border.

The Afghan stretch of the pipeline will run from the northwestern border with Turkmenistan, south through the western city of Herat to Kandahar near the border with Pakistan.

"TAPI is a transformation agenda for the region, not just a pipeline," state minister for petroleum Dr Musadik Malik was quoted as saying in a statement released by the Pakistani ministry of petroleum after Malik held a meeting with a delegation from Turkmenistan led by State Minister and Chairman of Turkmengas, Maksat Babayev.

"Meeting agreed to appoint a high-level official from Pakistan to resolve open issues. Technical working group on TAPI will hold extensive meeting today," the statement added.

Work on the project has been stalled due to differences over price review and delivery points.

As per the original deal, Pakistan, Afghanistan and India would have 15% share of gas, while Turkmenistan would get 85%. Under the existing gas sale-purchase agreement, the gas delivery point is the Afghanistan-Turkmenistan border, which Pakistan wants moved to the Pakistan-Afghanistan border.

ISLAMABAD: The Pakistan army said on Wednesday it was time to tighten the "noose of law" against those who had masterminded attacks on military buildings last month, in what is being widely seen as a reference to former Prime Minister Imran Khan.

Khan's arrest on corruption charges on May 9, which he says was at the behest of top generals in cahoots with the civilian government of PM Shehbaz Sharif — both deny involvement — led to violent nationwide protests, with rioters attacking an air base, military properties, including the army's headquarters, and burning a top general's home. Demonstrators also attacked government and private buildings and vehicles.

Since the protests, dozens of members of Khan's Pakistan Tehreek-e-Insaf (PTI) party and hundreds of his supporters have been arrested in what local and international rights bodies have widely called a state crackdown. The army and government have both publicly said the instigators and enactors of the violence would be punished and those who attacked army properties would be tried by military courts. Dozens of arrested suspects have since been handed over to the army for trials.

In a strongly-worded statement released on Wednesday after a meeting of top Pakistani military commanders, the army reiterated that it would punish those who had attacked its properties as well as go after the masterminds of the violence.

"While the legal trials of perpetrators and instigators have commenced, it is time that noose of law is also tightened around the planners and masterminds who mounted the hate ripened and politically driven rebellion against the state and state institutions to achieve their nefarious design of creating chaos in the country," the army's media wing, ISPR, said.

"Forum also resolved that endeavours by any quarter to create obstructions and stymie the conclusive defeat of ill design of inimical forces will be dealt with iron hands."

Responding for the first time to widespread accusations that the army was behind a crackdown against Khan, his party and its supporters and carrying out human rights violations, the army called this "fake news and propaganda" that it would defeat with the support of the Pakistani public:

"Unfounded and baseless allegations on Law Enforcement Agencies and Security Forces for custodial torture, human rights abuses and stifling of political activities are meant to mislead the people and malign Armed Forces in order to achieve trivial vested political interests."

The army reiterated that those who had damaged military properties would be brought to justice "speedily under the Pakistan Army Act and Official Secret Act which are the derivatives of the Constitution of Pakistan."

"In this regard, efforts to create distortions and attempts to take refuge behind imaginary and mirage Human Rights Violations to create smoke screen for hiding the ugly faces of all involved, are absolutely futile and do not stand the abundantly collected irrefutable evidences," ISPR said.

The military's statement comes as mention of Khan has blacked out on local television, following a directive last week by the national media regulator not to give airtime to "hate mongers, rioters, their facilitators and perpetrators." The directive did not name Khan.

Most newspapers, in which Khan was for years front page news, have also stopped covering him.

Since being ousted from the PM's office in a no-trust vote in April last year, Khan has launched an unprecedented campaign of defiance against the military, which independent analysts say helped him rise and fall from power.

The military has ruled Pakistan directly or indirectly for most of its 75-year history but says it no longer interferes in political affairs.

KARACHI: Cash-strapped Pakistan plans to save $1 billion per year through a new energy conservation plan that calls for, among other measures, closing markets across the country earlier than normal business hours, according to a government document, though Pakistani business leaders have rejected the proposal as "unrealistic" and "illogical."

Planning Minister Ahsan Iqbal this week announced that the National Economic Council (NEC) had approved a proposal to close all markets across the country at 8pm from July 1.

The move is part of a larger scheme by the government to spur economic growth through an action plan called Export, E-Pakistan, Environment and Climate change, Energy and infrastructure and Equity and Empowerment or 5Es framework and Sustainable Energy for All (SE4ALL), a brain child of the planning ministry.

The energy conservation plan and associated implementation roadmap was approved by the federal cabinet in January 2023 while the National Energy Efficiency and Conservation Policy 2023, prepared by the National Energy Efficiency and Conservation Authority (NEECA), was approved by the federal cabinet on May 10, 2023.

"The easy to deploy short- and medium-term administrative measures proposed under this conservation plan could save estimated outflow of USD ($) One billion per annum in terms of energy saving," a government document seen by Arab News said.

Listing measures under the plan, the document said:

"The closure of commercial markets at 8 pm which will result in annual energy saving of 2.85 billion electricity units and will offer a financial saving of 282 million USD, Ban on the incandescent bulbs which will result in a saving of 1 billion electricity units in a year with a financial benefit of 103 million USD, Mandatory installation of the conical baffles in the water geysers which will save 419 million USD."

Overall, the long-term implementation of the NEECA policy measures will result in financial savings of $6.4 billion from 2030 onwards, according to official estimates.

The South Asian nation last attempted to enforce early market closures in June and December 2022 but was met with resistance from traders. This time too, Pakistani traders have rejected the government's plan, saying it will cause revenue and job losses at a time that the country is grappling with record inflation, fiscal imbalances, and low reserves.

"We strongly reject the government's plan to shut down markets at 8pm," Kashif Chaudhry, the president of the Markazi Tanzeem-e-Tajran Pakistan, a central body of traders, said in a statement. "The decision has been taken in haste without consulting traders. It is an unrealistic plan."

Chaudhry called the plan an "enemy of traders and the public," and said such "illogical energy conservation plans" had also failed in the past. Atiq Mir, the chairman of the All Karachi Tajir Ittehad, the main business association in the city, concurred with Chaudhry.

"The decision is not practicable," he told Arab News. "Such decisions were taken in the past and could not be implemented."

Retail sector stakeholders said the government's decision would impact both revenue generation and employment rates.

"I think the decision taken is not realistic under the current economic downturn and would put the livelihood of around three million people at stake," Rana Tariq Mehboob, the chairman of the Chainstore Association of Pakistan (CAP), told Arab News.

"This decision will hit the economy with around Rs3.6 trillion losses while it is already reeling under the impact of slowdown."

Experts also said there was little hope the new plan would be implemented.

"They will not be able to implement this time too," Ammar Habib Khan, an economist and energy expert, told Arab News. "Due to weak administration and weak enforcement mechanisms, you can't implement this energy saving action plan … In fact, there is no will to enforce it."

Ahsan Iqbal and other planning ministry officials did not respond to Arab News queries about expected measures to enforce the energy saving plan.