Category: 3. Business

The Governor of the State Bank of Pakistan (SBP), Jameel Ahmad, said that inflation has declined sharply and is projected to remain within the government’s target range of 5 to 7% over the medium term, although recent floods may exert temporary upward pressure on prices. 

Addressing the 9th Annual Microfinance Conference on Thursday, organised by the Pakistan Microfinance Network under the theme “Renaissance of Microfinance,” Governor Ahmad reiterated that achieving inclusive economic growth requires durable macroeconomic stability that uplifts communities and ensures prosperity for all. He reaffirmed the central bank’s commitment to expanding financial inclusion and narrowing the gender gap.

The governor said that the policy and regulatory measures implemented in recent years have established a period of macroeconomic stability, reflected in significant improvements in key economic indicators. 

He noted the remarkable growth in Pakistan’s foreign exchange reserves since February 2023 and strategic interbank purchases, which have strengthened reserves and enabled the government to make timely debt repayments without borrowing at higher interest rates.

Governor Ahmad emphasised that the SBP’s monetary policy and regulatory efforts have been complemented by sustained fiscal consolidation by the government, helping to contain demand-side pressures on inflation and the external account. 

He pointed out that Pakistan’s debt dynamics have considerably improved over the past three years and that economic growth is on track to recover and is expected to accelerate further in the current fiscal year. Reflecting on two decades of progress, the Governor reaffirmed SBP’s commitment to microfinance as a driver of inclusive growth and explained that the central bank has revised the Prudential Regulations for Microfinance Banks, transitioning from a rules-based to a principles-based approach. These reforms have removed restrictions on microenterprise lending, allowed greater operational flexibility, introduced a dedicated Agriculture and Livestock loan category, and increased loan limits up to Rs 5 million for agriculture, microenterprise, and housing loans, and Rs 500,000 for general loans.

He further highlighted the launch of the Climate Risk Fund under the World Bank-funded Resilient and Accessible Microfinance Project, which aims to support two million borrowers through liquidity facilities to mitigate the impact of climate shocks. 

In collaboration with the government, SBP has also introduced a Risk Coverage Scheme for Small Farmers and Underserved Areas, providing 10% first-loss coverage and operational incentives to expand lending in underserved regions such as Balochistan, Khyber-Pakhtunkhwa, Azad Jammu & Kashmir, and Gilgit-Baltistan.

Governor Ahmad underscored the progress under the National Financial Inclusion Strategy (NFIS) 2028, noting that financial inclusion rose from 47% in 2018 to 67% in June 2025, while the gender gap in financial access narrowed from 47% to 30%. He credited transformative digital initiatives including Raast, Asaan Mobile Account, Roshan Digital Account, the launch of Digital Banks, and the Banking on Equality Policy. He also reiterated the NFIS 2028 targets, which aim to expand financial inclusion in Pakistan to 75% and reduce the gender gap to 25% by 2028.

The Governor urged microfinance institutions to strengthen risk management practices by utilizing alternative data sources, digital tools for credit scoring, conducting internal audits, training staff to prevent fraud, and maintaining adequate liquidity buffers. He emphasized that good corporate governance, transparent communication, and climate-risk mapping are essential to fostering long-term sustainability.

Hi everyone! This is Cheng Ting-Fang, your #techAsia host this week.

Greetings from the “Silicon Desert” of Arizona, where I have had the rare opportunity to visit Intel’s newest and most advanced facility. Known as Fab 52, it has just begun production of the world’s most cutting-edge chips, marking a key milestone for the American chipmaker’s tech comeback bid.

Suiting up in a cleanroom gown was an experience. It started with a shower cap, then a full head cover that also covered my nose and mouth. Two pairs of gloves, one rubber and one cotton, to fully seal my hands were followed by shoe covers, cleanroom boots and protective eyewear. This provides a glimpse into the daily routine of a technician working on an ultra-advanced production line. And keep in mind, workers need to wear this gear the entirety of their 12-hour shifts.

Factory manager Michael led us through the factory floor of Fab 52, home to Intel’s most advanced 18A chip production.

Machines known as overhead hoist vehicles immediately caught everyone’s attention. Moving along tracks on the ceiling, they formed a kind of “multi-story superhighway” connecting all of Intel’s fabs across the campus. More than 2,100 of these driverless cars travel along about 30 miles of track, ferrying silicon wafers from one machine to another. We also stopped by ASML’s advanced extreme ultraviolet (EUV) lithography machines on the cleanroom floor. The tools are essential for printing the world’s tiniest transistor structures — and they are not the only cutting-edge feature of the plant.

“Even the concrete used to build the new factory needs to be specially tailor-made to accommodate new machines and new technologies,” the factory manager said. According to Intel, about 600,000 cubic metres of concrete and 75,000 tonnes of steel reinforcement were used for Fab 52, roughly twice the amount used to construct the Burj Khalifa in Dubai, the world’s tallest building.

Outside, under the azure October sky, stretched the sun-baked plains of the desert, dotted with iconic saguaro cacti and agave plants. Rugged mountains loomed in the distance.

About an hour’s drive north from Intel’s campus in Chandler towers another impressive sight: “Big Red”, the largest crane in the US. Its presence is a sign that construction remains in full swing at another leading chipmaker, Taiwan Semiconductor Manufacturing Co. The company plans to start installing equipment at its second plant in north Phoenix next year, while construction on a third facility started earlier this year. Several more facilities are expected to follow, as TSMC has committed to investing a total of $165bn in the US.

Arizona is a unique place where two of the world’s top chipmakers, Intel and TSMC, are building or plan to make their most advanced chips. Yet many industry leaders note that manufacturing in the US comes with higher costs and a shortage of skilled workers, challenges I witnessed first-hand during my trip.

A simple meal of two sushi rolls with miso soup cost nearly $40, more than double what I would pay in Taiwan or Japan. A basic wash and blow-dry at a hair salon was over $50, with a 20 per cent tip expected as a matter of course. Similar services in Taipei or Tokyo cost about a third. (Though Arizona residents told me that the cost of living in the Grand Canyon State is still much more affordable than in California!)

Even getting around day to day felt slower. An average Uber wait was around 10 to 12 minutes, compared with just 3 to 5 minutes in many Asian cities. Labor shortages were also clear: at two hotels where I stayed, a single staff member handled the entire breakfast shift, taking orders, brewing coffee and preparing everything from avocado toast and fried eggs to bagels.

Still, several of my industry friends say that Arizona and the greater Phoenix area are quickly changing, becoming more vibrant as new investments pour in. They tell me that by the next time I visit, it won’t feel like a “food desert” anymore, with well-known Taiwanese restaurants opening branches, plans for mega malls and hotels and a new direct flight from Taipei launching in December.

China makes waves in wafers

China’s localisation bid for critical materials and components has started to rattle global players. The latest shock is in silicon wafers, the essential base material on which most chips are built.

The market has long been dominated by a few major players: Japan’s Shin-Etsu Chemical and Sumco, Taiwan’s GlobalWafers and Germany’s Siltronic. However, Chinese suppliers are rapidly gaining ground, capturing meaningful market share as Beijing pushes to localise critical semiconductor materials. Silicon wafers have become a key focus in China’s drive to strengthen its domestic chip supply chain, Cheng Ting-Fang and Lauly Li report.

China’s leading wafer maker, Xi’an Eswin Material Technology, is preparing to go public on the Shanghai STAR Market. The company is led by renowned tech entrepreneur Wang Dongsheng, founder of display giant BOE Technology Group. Eswin has already captured about 7 per cent of the global silicon wafer market as of 2024 and is expected to exceed 10 per cent in coming years. Overall, China’s self-sufficiency in using domestically produced wafers among its local chipmakers has already reached 50 per cent, and that rate is expected to rise significantly.

Back in the game

Global investors are tiptoeing back into China’s start-up world. After a freeze driven by US-China tensions and Beijing’s tech crackdown, several of the country’s biggest venture capital firms are again raising fresh US dollar funds, write the Financial Times’ Ryan McMorrow and Eleanor Olcott.

ByteDance backer Source Code Capital and Pop Mart investor BA Capital have each secured about $150mn, while Lightspeed China Partners has raised over $200mn and Qiming Venture Partners is targeting $600mn for biotech bets.

While the $1.1bn being raised by the VC groups is a far cry from the $30bn that was ploughed into China VC in 2021 and 2022, it marks a thaw after global investors retreated in 2023.

VCs say the booming Hong Kong IPO market and a hot robotics and AI scene have reignited global investors’ interest.

“The entire robotics supply chain is in China,” said Xing Meng of 5Y capital, adding that valuations were a fraction of those earned by start-ups in the US

Overtaking the pack

US chip investment is projected to accelerate sharply from 2027, outpacing other major chip economies including China, South Korea and Taiwan, Yifan Yu and Cheng Ting-Fang report from Phoenix, Arizona.

According to the latest estimates by SEMI, investment in US chip manufacturing, including equipment purchases and facility construction, is expected to rise from around $21bn in 2025 and 2026 to $33bn in 2027 and $43bn in 2028. The total between 2027 and 2030 is forecast to reach $158bn.

This surge in domestic chipmaking capacity is largely driven by government policies and a new tariff environment aimed at reshoring chip production, as well as the growing demand for AI computing, a sector in which US chip developers continue to lead the global market.

SoftBank gets physical

SoftBank said it will acquire the robotics business of Swiss-based automation solutions provider ABB for $5.4bn, as the Japanese conglomerate expands its AI investments into a new frontier, Nikkei Asia’s Tsubasa Suruga writes. SoftBank founder Masayoshi Son is betting big on “physical AI”, or embedding AI into machines such as cars or robots to create autonomous systems capable of acting and making decisions like humans. Adding ABB’s robotics business to the group’s portfolio is expected to be a major boost for such ambitions.

Son’s push echoes that of Infineon’s CEO, who said in an exclusive interview with Nikkei Asia that “physical AI”, including humanoid robots, promise the most exciting growth opportunities for the emerging technology.

Suggested reads

1. China curbs use of Nokia and Ericsson in telecoms networks (FT)

2. Indian logistics get tech overhaul to support supply chain shift (Nikkei Asia)

3. EU pushes new AI strategy to reduce tech reliance on US and China (FT)

4. America risks a dangerous dependence on Chinese chips (FT)

5. Japan’s Ricoh eyes ink-jet tech to make flexible solar cells (Nikkei Asia)

6. SoftBank’s Son looks to ‘next frontier’ of AI robots with ABB deal (Nikkei Asia)

7. Convicted moguls Sean Combs and Miles Guo ponder AI platform after jail (FT)

8. NTT and Broadcom to build key device for ultrafast optical network in 2026 (Nikkei Asia)

9. Japan grapples with surge in exploding portable power banks (Nikkei Asia)

10. India solar panel start-up to double capacity, with AI aiding inspections (Nikkei Asia)

#techAsia is co-ordinated by Nikkei Asia’s Katherine Creel in Tokyo, with assistance from the FT tech desk in London. 

Sign up here at Nikkei Asia to receive #techAsia each week. The editorial team can be reached at techasia@nex.nikkei.co.jp

The collaboration between Maersk and CATL has continued to expand and evolve. We’re pleased to enter this new phase of partnership, combining CATL’s cutting-edge battery technologies with our integrated logistics capabilities to redefine what’s possible in logistics. This partnership presents a powerful opportunity to accelerate the decarbonisation of global logistics – not only for Maersk, but also for our customers and the broader industry.

As a global giant of integrated logistics, A.P. Moller – Maersk, just like CATL, is committed to promoting energy transition and achieving a net-zero emissions future. At this new stage of development, both parties aim to deepen collaboration in shipping, end-to-end supply chain, digitalisation, and new energy applications, working together to accelerate decarbonisation in the global logistics industry.

Oil held the biggest decline in a week on cautious optimism about easing tensions in the Middle East and the outlook for supply.

Brent traded near $65 a barrel after closing 1.6% lower on Thursday, while West Texas Intermediate was below $62. Israel approved a framework that would see Hamas release hostages in exchange for prisoners, a major step forward for a peace agreement to end the bloody conflict in Gaza.

KARACHI:

Pakistan’s foreign exchange reserves recorded a marginal increase during the week ended October 3, 2025, despite substantial external debt repayments.

According to data released by the State Bank of Pakistan (SBP), the central bank’s reserves rose by $20 million to $14.42 billion. During the same period, the SBP made external debt payments, including the repayment of a $500 million Pakistan Sovereign Eurobond.

The country’s total liquid foreign reserves stood at $19.81 billion, comprising $14.42 billion held by the SBP and $5.39 billion held by commercial banks.

Meanwhile, the Pakistani rupee recorded a slight appreciation against the US dollar on Thursday, rising by Rs0.01 in the inter-bank market. By the end of the trading session, the rupee stood at 281.20 against the greenback, compared to 281.21 a day earlier.

Moreover, gold prices in Pakistan remained unchanged at Rs425,178 per tola, despite a sharp fall in the international market where bullion lost over 1% and slipped below the $4,000 per ounce mark. The global decline followed a stronger US dollar and profit-taking by investors after the announcement of a ceasefire deal between Israel and Hamas.

According to the All Pakistan Sarafa Gems and Jewellers Association, the price of 10 grams of gold also stayed stable at Rs364,521. A day earlier, gold had surged by Rs8,400 per tola, reaching a record high of Rs425,178 amid a rally in global markets that pushed bullion past the $4,000 milestone for the first time.

Adnan Agar, market analyst and Director at Interactive Commodities, noted while gold prices hit historic highs, some correction was expected due to overbought conditions and global market pressure. He added that silver, which also reached an all-time high earlier this week, has started showing signs of consolidation as investors turn cautious after the extraordinary rally.

Silver, spurred by momentum in the gold market, strong investment demand and a persistent supply deficit, rose above $50 per ounce for the first time, according to Reuters.

Spot gold fell 1.1% to $3,993.41 per ounce by 12:38 pm ET (1638 GMT). US gold futures for December delivery fell 1.6% to $4,006.40.

The US dollar index was up 0.5% and hovered near a two-month high, making dollar-priced bullion more expensive for overseas buyers.

“Speculators are taking some gold chips off the table as the Gaza ceasefire takes effect since it reduces the temperature in a historically volatile region,” said Tai Wong, an independent metals trader.

As part of these efforts to promote dialogue, last week we welcomed Teresa Ribera, Executive Vice President of the European Commission for a Clean, Just and Competitive Transition. The session provided an enriching discussion between the senior European Commission representative and the business community regarding the challenges Europe is facing in its decarbonization process, without undermining its industrial base or global economic leadership.

Despite the uncertain geopolitical context, Ribera was optimistic, pointing out that Europe has “great opportunities and strengths” to achieve its goals. But she warned that it is time to take a “qualitative leap” that entails working on two fronts: the domestic agenda, moving towards greater integration of the Single Market; and the external agenda through the redefinition  of its trade policy.

In her remarks, the Vice President underscored six strategic pillars, from global geopolitical transformation and the technological rivalry between the U.S. and China, to the central role of sustainability as a driver of competitiveness and the need for a more integrated Single  Market and a stronger capital market – which is key to financing our innovation.

The Green Deal Industrial Plan is a key instrument to accelerate the decarbonization and modernization of the European industrial sector. Its objectives include promoting the production of clean technologies, reducing external dependencies and establishing a common, coherent framework that ensures equal opportunities among countries and sectors.

For Vice President Ribera, the discussion is not about whether we should move towards climate neutrality ensuring that the Green Deal targets “continue moving forward”, but about “how to fit the pieces together in the most efficient way”, supporting our SMEs so that no one gets left behind in this transition. At the bank, we support this vision, as we understand that sustainability and competitiveness are not conflicting goals, but rather complementary ones. Therefore, the success of the European model will depend on its ability to combine its climate ambition, social inclusion and technological innovation.

In the subsequent open dialogue with the business community, Ribera addressed some of the concerns that were shared by the presidents of the sectoral commissions: Federico Ramos (Circular Economy); Isabel Puig (SMEs) and Patxi Calleja (Energy). Their questions focused on the main pillars of European competitiveness: the circular economy, administrative simplification, the industrial strength of SMEs and access to European funding. In this regard, they highlighted the urgency of making further progress on regulatory simplification, and emphasized the importance of supporting SMEs to ensure their full integration, preventing the green transition from becoming a barrier to growth.

We are at a decisive moment. The European Union cannot afford to stand still. A clean, just and competitive transition will only be possible if the public and private sectors act as true strategic partners, each fulfilling their share of the commitment. It is a shared effort to build a stronger, more united Europe – one that is ready to lead the future.

To an astounding extent, running the modern world depends on a single process: petrochemical steam cracking. However, the steam cracking process emits enormous quantities of greenhouse gases. As part of a global effort to address this, a laboratory in Dalian, China, is now exploring novel options to use CO2 itself as a feedstock instead of petroleum, in a process that mimics natural photosynthesis.

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In gargantuan manufacturing facilities around the world, hydrocarbons (normally from petroleum) are put under enormous pressure and raised to 850C in order to crack them into the basic building blocks of chemical production. These are then recombined or processed in various ways to create a vast array of products such as plastics, fertilizers, cosmetics, agrochemicals, paints, vitamins, and pharmaceutical ingredients. It is hard to overstate the importance of such basic chemicals as the source of all of the other materials that make civilization possible.

Ethylene is one of these basic building blocks. Consisting of a molecule composed of two carbon and four hydrogen atoms, it is one of the most fundamental products that result after applying heat and pressure to a hydrocarbon feedstock such as petroleum. Producing ethylene and other basic chemicals is enormously energy-intensive, emitting around 1.05kg to 1.3kg of greenhouse gas equivalents for each kilogram of ethylene manufactured in the cracker.

One way of reducing these emissions, which has already been implemented at some demonstration plants, is to power the steam cracker with renewable electricity. Another option is to use alternative feedstocks such as biological oils, an approach that is also already happening in small quantities. However, the global supply of waste cooking oil is limited, and oil-producing agricultural crops may compete with food production.

For decades, therefore, scientists have been searching for alternative ways to produce ethylene and other cracker products. One alternative could be to use carbon dioxide (CO2)  – a waste product of combustion and a damaging greenhouse gas – as the feedstock. In this case, the reaction would be catalyzed not with heat and pressure but with light. Indeed, nature already produces some ethylene when sunlight drives a reaction between water (which is made of hydrogen and oxygen) and CO2. Grade school students are familiar with this process, known as photosynthesis.

Could a process similar to photosynthesis be used to synthesize the chemicals that humans consume in such enormous quantities? 

To make this possible, the crucial missing element – hydrogen – must be added to the mix. This is known as hydrogenation. Fortunately, over the past several years, it has become cheaper to produce hydrogen with electrolysis, using renewable electricity. 

Now, a new paper from the Dalian Institute of Chemical Physics describes a potential system for production of ethylene in a laboratory environment, using hydrogenated CO2 as the feedstock and sunlight as the catalyst. 

In previous attempts to achieve a photosynthesis-like reaction, scientists had used water as their hydrogen source, just as plants do; the hydrogen is split off from the H2O directly, in order to hydrogenate the CO2. In the new method, however, scientists used hydrogen manufactured elsewhere, and bombarded a titanium dioxide catalyst with ultraviolet light – a so-called “photocatalytic” process. This allowed them to produce ethylene at room temperature, without the need for a 850C steam cracker.

Bringing this process from the laboratory to the factory is crucially dependent on the availability of cheap green hydrogen – in other words, hydrogen produced with renewable electricity. 

In an emailed response to Earth.Org, Daniel Keck, Head of Technology, Basic Petrochemicals at BASF said using this pathway to produce basic chemicals “can be an interesting alternative,” although he added that only low electricity prices can guarantee competitiveness. 

“This is especially true for the specific example of CO2 activation, because it requires a large amount of electrical energy. In this sense, photocatalytic materials could be an interesting alternative but still require hydrogen as a feedstock that needs to be produced by electrolysis,” he added.

The new approach presented in the paper, which was published last month, produced an extremely high yield of ethylene – more than 99%. However, the process relies on highly specific steps such as creating a type of “dipole” by situating holes on metallic gold nanoparticles with a titanium oxide layer. The process is, as such, limited to an experimental phase. 

According to Keck, the method is still at a “very early stage of technology deployment.”

“This conceptual approach will need to be further developed towards efficiency and overall system cost with the target to develop a commercial technology. While the approach offers benefits, the technology hurdles for deployment are not to be underestimated and will require several years of development,” he said.

While the distance from the “lab to the fab” can be great, its potential when deployed at scale would be enormous. Global ethylene production, currently at 177 million tons per year, is projected to grow 262 million tons by 2035, with Asia accounting for more than 40%. A more sustainable path to ethylene production could impact not only this US$238 billion market but the future of our planet.

Featured image: BASF SE.

ISLAMABAD:

The government has allocated Rs9 billion under the Pakistan Accelerated Vehicle Electrification (PAVE) scheme for the current fiscal year, aiming to subsidize the purchase of approximately 116,000 electric bikes and 3,000 electric rickshaws and loaders.

Responding to a query raised by Anusha Rehman during Question Hour in Senate, State Minister for Railways, Finance and Revenue Bilal Azhar Kayani stated that the initiative falls under the recently launched New Energy Vehicle (NEV) Policy 2025–30, which is aimed at accelerating the adoption of electric vehicles and enhancing local EV manufacturing capabilities.