no, you can still give karma, cause i've already experience it!
well first, you only can give karma to your friends exactly.
but if you don't want to give karma to a friend, he/his account must not be PRIVATE

next, if you want to give karma to a friend, just search his/her name
then go to her/him profile. then you can see there the remove friend, subscribe blog, our history, mutual friend etc.
then there is a new button there, and it's GIFT KARMA :D

there, i hope i helped you with that :)

Maybe you don't have any karma to give ? o.O O have no idea what's wrong.