The cement industry of Pakistan has seen many developmental projects last week. These developments include the news about the start of construction of Diamer Basha Dam project.
Along with new mega developmental projects, the central bank of the country has also reduced the interest rate by 100 bps to 8 percent to encourage new investments and the news that the government will allocate sufficient development funds in the upcoming budget.
These new updates will help in the growth of the cement industry which was badly impacted by Coronavirus pandemic and in the last three months, cement production dropped by a whopping 20 percent.
This encouraging news has resulted in the bullish stock market especially in the stock shares of steel and cement industries.
Prime Minister of Pakistan Imran Khan has announced the construction of the Diamer Basha Dam with an agreement worth Rupees 442bn with a joint venture, Power China-FWO for construction of diversion system, assess bridge, main dam and the 21 MW Tangir Hydropower project as part of the Diamer Basha dam project. The whole project estimated cost rupees 1406bn that will be completed in 2028.
State bank of Pakistan has marked the policy interest rate by 100 basis points to 8 percent. It was done to provide easy liquidity to help businesses under stress due to coronavirus. This reduction was the fourth one within two months. Because of the falling inflation, its cumulative interest rates were marked by 5.3 percent.
Cement production of Pakistan increased by 1.7 percent YoY to 30.049Mt in the nine-month period. However, the production contracted by 16.6 percent to 2,982Mt versus 3.574Mt in March 2019, and the upward trend was reversed in March in 2020.
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