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Reduced demand forces Millat Tractors to cut production days

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  • MLT announces closure citing decline in demand for tractors.
  • Analysts say agricultural land of Sindh is still under water due to floods. 
  • Cite high inflation behind reduction in demand for tractors.

KARACHI: Millat Tractors Limited (MTL), in a statement sent to the Pakistan Stock Exchange (PSX), announced the closure of its production on Fridays citing a decline in demand for tractors in the country, The News reported Friday. 

“Due to reduced demand for tractors, the company will observe Fridays as non-production days from December 16, 2022, till further notice,” the company secretary of Millat Tractors said in a statement.

As per the analysts, the agricultural land of Sindh was still under water in many areas due to the cataclysmic floods in the country

They added that there was also an increase in inflation in the country which has led to a reduction in demand for tractors. 

In October, Millat Tractors recorded a decrease of 75% month-on-month and 72% year-on-year to reach a sales figure of 638 units due to the shutdown of plants for 23 days in September amid floods.

In a report published on December 13, sales of all other variants of cars, trucks, buses, tractors, jeeps, pick-ups, and three-wheelers as well as two-wheelers saw a decline in November 2022 compared with November 2021.

Decline in motorcycle production

Meanwhile, motorcycle manufacturing has also witnessed a decline in 2022 which may be due to the steep increase in the price of two-wheelers.

Since bikes are purchased and used by low-income buyers, the sales might have slowed a bit if the prices remained stable, however, at current rates and almost stagnant incomes, people are struggling to make ends meet.

Another reason for the drop, the report added, might be declining agricultural productivity, as most motorbike sales in the country are accounted for in rural areas. Recent floods that affected over 34 million people are a reason for slumping sales.

Motorcycle production data is from the Pakistan Automotive Manufacturers Association (PAMA), however, many motorbike manufacturers are not registered with it, and the Pakistan Bureau of Statistics (PBS) records their production data.

However, the statistics for last year are available that put the total motorbike production at 2.6 million.

The PAMA statistics for the first five months of the current fiscal year give a true picture of the state of the bike industry in the country.

In the July-November 2022 period, the bike industry (registered with PAMA) produced 521,643 bikes against 797,346 produced during the same period of last year. 

This is a massive decline of 34% in the first five months of the current fiscal year.

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February 7, 2025: The value of the Pakistani Rupee (PKR) in relation to the US dollar is unchanged.

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KARACHI: The open market exchange rate between the US dollar and the Pakistani rupee (PKR) was Rs279.4 on February 07, 2025, with a selling rate of Rs281.1. The interbank exchange rate between the US dollar and the Pakistani rupee is Rs 278.45, according to Interbank.

There was no movement in the US dollar (USD) from the previous closure of Rs278.

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The NORINCO Group is invited by CM Sindh to explore opportunities.

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Chinese companies have been invited by Sindh Chief Minister Syed Murad Ali Shah to visit Karachi and other regions of Sindh Province in order to observe the quickly growing businesses and investigate prospects in fields like clean energy, infrastructure development, and public transit projects.

Speaking in Beijing to a delegation headed by the chairman of NORINCO International Co., Ltd., he stated that all facilities required would be provided by the governments of Sindh Province and Pakistan.

With assistance from NORINCO International, the Sindh Chief Minister stated that the Provincial Government will firmly urge North Vehicle and BeiBen to think about setting up a Vehicle Assembly Plant in the Dhabeji Special Economic Zone.

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A deal with Pakistan to fight financial crimes has been approved by the Saudi cabinet.

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In order to strengthen collaboration in the fight against money laundering, terrorist financing, and associated crimes, the Saudi Press Agency announced this week that the Saudi cabinet, led by Crown Prince Mohammed bin Salman, had approved a memorandum of understanding (MoU) with Pakistan’s Financial Monitoring Unit (FMU).

Due to its severe money laundering and terrorism funding issues in recent years, Pakistan was added to the Financial Action Task Force’s (FATF) grey list in June 2018.

The nation was taken off the gray list in October 2022 after enacting extensive measures to fortify its financial system.

The FMU is Pakistan’s financial intelligence unit, created under the Anti-Money Laundering Act of 2010 and tasked with collaborating with foreign partners and evaluating reports of suspicious transactions.

According to the SPA, “the cabinet approved a memorandum of understanding regarding cooperation in exchanging investigations related to money laundering, terrorist financing, and related crimes between the Financial Monitoring Unit in the Islamic Republic of Pakistan and the General Department of Financial Investigation at the Presidency of State Security in the Kingdom of Saudi Arabia.”

The MoU is an indication of Saudi Arabia and Pakistan’s growing strategic partnership. A significant Pakistani diaspora resides in the Kingdom, and numerous Pakistani businesses have established a presence there.

Saudi Arabia has been a key supporter of Pakistan’s economy, bolstering its reserves with substantial deposits in the State Bank of Pakistan and offering deferred oil payment facilities.

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