Pak hikes defence spending by 20% in budget amid tense relations with India
Pakistan on Tuesday increased its defence budget by 20 per cent, allocating PRs. 2,550 billion (USD 9 billion) for the fiscal year 2025-26, amid tensions with India.
Finance Minister Muhammad Aurangzeb presented the PRs. (Pakistani Rupees) 17,573 billion worth federal budget for the fiscal year 2025–26 in the National Assembly. He also presented the budget document as a finance bill in the National Assembly.
In his speech, the minister said that the government has 'decided to allocate PRs. 2,550 for the defence of the country'.
He didn't provide any further details about the defence spending as traditionally the defence budget is not discussed by the parliament.
Last year, the government allocated PRs. 2,122 billion for defence, reflecting a 14.98 per cent increase over PRs. 1,804 billion budgeted for the fiscal year 2023-24.
'This budget is being presented at a historic time when the nation showed unity [and] determination,' the minister said at the start while mentioning the recent Pak-India conflict.
Tensions between India and Pakistan escalated after the April 22 Pahalgam terror attack, with India carrying out precision strikes on terror infrastructure in Pakistan and Pakistan-occupied Kashmir on May 7.
The on-ground hostilities from the Indian and Pakistan sides that lasted for four days ended with an understanding of stopping the military actions following talks between the directors general of military operations of both sides on May 10.
The defence sector expenses are the second-biggest component of the annual expenditure after the debt payments. The government allocated PRs. 8,207 billion for debt servicing, which constitutes the single biggest expense.
The increase in the defence expenditure is expected to get the broad support of the lawmakers during the budget debate and voting on the finance bill.
Aurangzeb also announced a 4.2 per cent GDP growth target for the economy which is higher than the 2.7 per cent achieved in the current year ending on June 30.
He said that debt and interest servicing would cost PRs. 8,207 billion. Other key expenses include PRs. 971 billion for civil administration, PRs. 1,186 billion for subsidies, PRs. 1,055 billion for pensions and PRs. 1,000 billion for the Public Sector Development Programme.
He said that the target for inflation was 7.5 per cent and the fiscal deficit target was 3.9 per cent as the government also announced to contain the deficit and achieve a primary surplus.
The minister said that the government has set an ambitious tax collection target for the Federal Board of Revenue at PRs. 14,131 billion, an 8.95 per cent increase from last year's goal.
Aurangzeb said that the main success of the government was that inflation was reduced to 4.7 per cent in the outgoing fiscal whereas it was 29.2 per cent two years ago, while the government achieved a current account surplus of USD 1.5 billion.
He said the forex reserves will touch USD 14 billion by the end of the year and remittances were expected to reach USD 38 billion.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
India Gazette
an hour ago
- India Gazette
India's agrochemical exports set for moderate rebound in FY25: Rubix report
New Delhi [India], June 22 (ANI): India's agrochemical exports are expected to moderately rebound in the Financial Year 2025, with improving demand and inventory normalisation, according to an industry report by Rubix, which analyses industry data and trends. India's agrochemical exports declined sharply in FY2024, by nearly 22 per cent compared to the previous year, primarily due to global inventory destocking, heightened price competition from China, and subdued demand in key export markets. The report says that distributors worldwide reduced procurement to manage excess stock amid falling prices. At the same time, Chinese suppliers re-entered the market with aggressively priced products, making Indian exports less competitive. Additionally, erratic weather patterns impacted agricultural activity in importing countries, further dampening demand. However, exports are expected to recover in the coming years as global inventories stabilise, demand picks up with improved agricultural cycles, and Indian manufacturers adapt with cost-efficient production and diversified portfolios. As a result, the trade surplus (difference between exports and imports) came down from USD 3.6 billion in FY2023 and USD 2.8 billion in FY2024 to USD 2.3 billion in FY2025 (April 2024- February 2025). Highlighting the factors that support exports, the report added that herbicides have emerged as the leading export segment, experiencing the fastest growth at 20 per cent CAGR from FY2020 to FY2025. The share of herbicides in total agrochemical exports increased from 31 per cent to 37 per cent during the same timeframe. As per the report, this growth is driven by India's cost-effective manufacturing, rising global demand for affordable herbicides, and the increasing scarcity and cost of agricultural labour, making herbicide-based weed control a more viable choice for farmers. The export landscape reveals a growing concentration in key markets, as the top five export destinations account for more than 50 per cent share for insecticides and fungicides and nearly 71 per cent for herbicides. Notably, the US and Brazil have maintained their positions as the top export destinations for insecticides and fungicides over the past five years. However, in FY2025, Japan displaced Brazil as the second-largest export destination for herbicides. (ANI)
Hans India
2 hours ago
- Hans India
Understanding Forex Major Pairs: The Foundation of Global Currency Trading
The foreign exchange market, commonly known as forex, represents the world's largest and most liquid financial market, with daily trading volumes exceeding $7 trillion. At the heart of this massive marketplace lie the forex major pairs , which form the backbone of international currency trading and serve as the primary vehicles for both institutional and retail traders worldwide. What Are Forex Major Pairs? Forex major pairs consist of the most heavily traded currency combinations in the global market, all of which include the US Dollar (USD) as either the base or quote currency. These pairs dominate trading volumes due to their high liquidity, tight spreads, and the economic significance of their underlying countries. The seven recognized major pairs are: EUR/USD (Euro/US Dollar) - Known as "Fiber," this is the most traded currency pair globally, representing the world's two largest economies. The European Central Bank and Federal Reserve policies heavily influence this pair's movements. GBP/USD (British Pound/US Dollar) - Called "Cable," this pair reflects the relationship between the UK and US economies. Brexit developments and Bank of England decisions significantly impact its volatility. USD/JPY (US Dollar/Japanese Yen) - Often referred to as "Gopher," this pair is particularly sensitive to risk sentiment and carry trade dynamics, with the Bank of Japan's monetary policy playing a crucial role. USD/CHF (US Dollar/Swiss Franc) - Known as "Swissie," this pair often moves inversely to EUR/USD due to the Swiss franc's safe-haven status and Switzerland's economic ties to the Eurozone. AUD/USD (Australian Dollar/US Dollar) - Called "Aussie," this commodity-linked currency is heavily influenced by China's economic performance and global risk appetite. USD/CAD (US Dollar/Canadian Dollar) - Known as "Loonie," this pair is significantly affected by oil prices due to Canada's status as a major oil exporter. NZD/USD (New Zealand Dollar/US Dollar) - Called "Kiwi," this pair is sensitive to dairy prices and global risk sentiment, often moving in correlation with AUD/USD. Why Major Pairs Dominate Trading The dominance of forex major pairs stems from several fundamental factors that make them attractive to traders of all levels. Liquidity stands as the primary advantage, ensuring that large positions can be opened and closed without significantly impacting market prices. This high liquidity translates to tighter bid-ask spreads, reducing trading costs for participants. The economic stability and transparency of the countries behind these currencies provide another crucial advantage. Major economies typically have well-established central banks, regular economic data releases, and predictable monetary policies, making technical and fundamental analysis more reliable. Additionally, the extensive coverage of these pairs by financial media, research institutions, and economic analysts ensures that traders have access to comprehensive information for making informed decisions. This wealth of information contrasts sharply with exotic currency pairs, where reliable data may be scarce. Trading Characteristics and Market Behavior Each forex major pair exhibits unique characteristics that traders must understand to develop effective strategies. The EUR/USD, for instance, tends to show strong trending behavior and responds predictably to European Central Bank and Federal Reserve announcements. Its high liquidity makes it ideal for both scalping and long-term position trading. The GBP/USD pair, while highly liquid, is known for its volatility, especially during UK market hours. Political developments, particularly those related to Brexit and UK economic policy, can cause significant price swings that create both opportunities and risks for traders. USD/JPY often serves as a barometer for global risk sentiment. During periods of market uncertainty, investors typically flee to the safety of Japanese yen, causing this pair to decline. Conversely, risk-on sentiment usually drives the pair higher as traders seek higher-yielding assets. The commodity-linked pairs, AUD/USD and USD/CAD, provide exposure to global commodity markets and economic growth expectations. These pairs often exhibit strong correlations with their respective commodity markets and Chinese economic data, given China's significant trade relationships with both Australia and Canada. Economic Factors Driving Major Pairs Understanding the economic fundamentals that drive forex major pairs is essential for successful trading. Interest rate differentials between countries play a crucial role, as higher-yielding currencies typically attract more investment capital. Central bank policies, including quantitative easing programs and forward guidance, can cause significant long-term trends in major pairs. Economic indicators such as GDP growth, employment data, inflation rates, and trade balances provide valuable insights into currency strength and direction. For example, strong US employment data typically strengthens the dollar across all major pairs, while weak European economic data might pressure the EUR/USD lower. Geopolitical events also significantly impact major pairs. Trade wars, political elections, and international conflicts can cause substantial volatility as markets reassess risk and adjust positioning accordingly. Risk Management in Major Pair Trading Despite their stability relative to exotic currencies, forex major pairs still carry significant risks that traders must manage carefully. Even the most stable currencies can experience rapid depreciation during crisis periods, and no currency is immune to becoming temporarily disadvantaged in global markets. Historical examples remind us that even major currencies can face severe challenges. While it would be hyperbolic to label any major currency as the worst currency in the world , traders have witnessed periods where traditionally strong currencies faced significant pressure due to economic crises, policy mistakes, or external shocks. Effective risk management strategies include proper position sizing, stop-loss orders, and diversification across multiple pairs. Traders should never risk more than they can afford to lose and should always consider the correlation between different major pairs when building their portfolios. Conclusion Forex major pairs remain the cornerstone of global currency trading, offering the optimal combination of liquidity, predictability, and opportunity for traders worldwide. Their dominance in the forex market reflects the economic importance of their underlying countries and the stability they provide in an often volatile trading environment. Success in trading major pairs requires a thorough understanding of their individual characteristics, the economic factors that drive their movements, and robust risk management practices. As the global economy continues to evolve, these pairs will undoubtedly remain central to forex trading, providing countless opportunities for those who approach them with knowledge, discipline, and respect for the market's power. Whether you're a beginner starting your forex journey or an experienced trader refining your strategy, mastering the dynamics of major pairs is essential for long-term success in the world's largest financial market.
Time of India
2 hours ago
- Time of India
Korean industry giants bet on battery recycling as global EV market matures
South Korea's leading industrial players are ramping up their efforts in the electric vehicle (EV) battery recycling sector, reflecting growing expectations that the currently sluggish market will develop into a vital part of the battery value chain, the Korea Herald reported on June 20. The LG Energy Solution , the South Korea's top battery manufacturer, has recently established joint ventures in both Europe and the United States -- partnering with France's Derichebourg and Toyota Tsusho Co., respectively. These initiatives mark LG's first direct entry into recycling operations in these key global markets. Meanwhile, SK Ecoplant, the construction and engineering arm of SK Group, is expanding its European operations in the Netherlands. The facility will add an annual processing capacity of 25,000 metric tons of black mass, with the expansion slated for completion in 2025, the South Korean English-language daily newspaper added. Going further, Posco-GS Eco Materials -- a joint venture between Posco Holdings and GS Energy, with ownership split 51:49 -- has also made a notable move by acquiring full ownership of its recycling unit, Posco HY Clean Metal. This was achieved by purchasing the 35 percent stake held by China's Huayou Cobalt in April, the South Korea's news platform added. These strategic shifts come amid a prolonged downturn in the battery recycling sector, fueled by weakened EV demand and falling prices of core battery minerals such as nickel, lithium, and manganese. Lithium carbonate prices, which exceeded 450 Chinese yuan (USD 63) per kilogram in January 2023, have plummeted to about 50 yuan. Nickel has also seen a steep drop from over USD 31,000 per ton to around USD 20,000. As a result, SungEel HiTech -- one of only two battery recycling companies listed on Korea's tech-heavy Kosdaq -- has faced falling profitability and declining free cash flow for two consecutive years. A joint recycling venture between SungEel HiTech and SK Innovation, announced in 2022, has been postponed indefinitely. Additionally, SK Ecoplant's planned facilities in Gyeongju, North Gyeongsang Province, and in Kentucky have shown little to no progress for several years. The news report added that the Korean industry watchers expect a sharp rise in used EV batteries reaching end-of-life status, generally around 10 years after initial use -- a timeline that aligns with the global EV sales boom in the 2010s, which topped one million units by 2015. With global EV adoption continuing to rise, the battery recycling market -- valued at USD 8 billion in 2022 -- is forecast to grow to as much as USD 53.57 billion by 2030, according to SNE Research. Experts argue that participating in the recycling segment is becoming crucial for maintaining competitiveness in the battery industry, especially as regulatory pressure mounts globally for the use of recycled materials. The European Union, for instance, mandates that EV batteries sold in the region must contain minimum percentages of recycled metals by 2031: 16 percent for cobalt, 85 percent for lead, 6 percent for lithium, and 6 percent for nickel. These thresholds will increase by 2036. In the United States, the Inflation Reduction Act excludes EVs from tax credits if key battery materials are sourced from "foreign entities of concern," further pushing manufacturers to procure materials domestically -- often through recycling.
