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  • ECC approves increase in wheat support price

    ECC approves increase in wheat support price

    ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet has approved the minimum support price of wheat to Rs1365 per 40 kilograms from Rs1350.

    The ECC, which was chaired by Dr. Abdul Hafeez Shaikh, Adviser to Prime Minister on Finance and Revenue, on Thursday approved the minimum support price of wheat from the previously announced Rs 1350 per 40 kg to Rs 1365 per 40 kg in view of representations from various farmers and growers’ associations as well as the Federal Cabinet and the National Assembly Special Committee on Agricultural Products which had proposed a reconsideration of the minimum support price in order to compensate the farmers in areas where the cost of wheat production had increased to Rs 1349.57 per 40 kg.

    Earlier, the Ministry of National Food Security & Research briefed the ECC on the feedback received from various farmers’ associations as well as different government forums and requested for fixing the minimum support price of wheat at Rs 1400 per 40 kg.

    The ECC deliberated on the proposal at length and in view of the discussion and input regarding the impact of any further increase in wheat price on food inflation and financial impact on the commodity stock operations, decided to raise the minimum support price of wheat to Rs 1365 per 40 kg.

    The ECC also viewed a presentation from the Ministry of Finance on the government commodity operations which had over the years resulted in Rs 757 billion as total debt and liabilities and recommendations for reducing the debt.

    The ECC also considered a proposal from the Ministry of Energy regarding tariff rationalization for power sector in the first quarter of financial year 2019-20 and a approved proposal for notifying the NEPRA approved quarterly adjustment of 15 paisa per unit after incorporating a additional charge of 11 paisa per unit for maintaining uniform tariff on all categories of consumers except lifeline and domestic consumers.

    The increase coming into effect on December 01, 2019 for the next twelve-monthly billing cycle would not be applicable to nearly 20 million using up to 300 units per month, out of the total 30 million consumers while 600,000 of the remaining one million consumers would only pay 7 paisa per unit as a result of this increase.

    The ECC also constituted a committee headed by Adviser to Prime Minister on Finance and Revenue Dr Abdul Hafeez Shaikh and comprising Minister of National Food Security and Research Makhdoom Khusro Bakhtiar, Prime Minister’s Advisor on Commerce and Investment, Abdul Razak Dawood and Special Assistant to Prime Minister on Petroleum Nadeem Babar to examine the current framework of determining power tariff and make it more simple in line with the practice in mature markets.

    The ECC also considered a set of proposals from the Ministry of Energy (Power Division) for risk mitigation post privatisation of National Power Parks Management Company, especially the impact on fuel basket price due to non or reduced off take of 66 per cent generation under the PPA till year 2024 and cost of diversion of Regasified Liquefied Natural Gas (RLNG) to other sectors with workable options to mitigate the risk.

    The ECC discussed the proposals in details and approved them with a proviso that any other option that could be considered as part of the mitigation plan by the Power Division could also be taken into account and approved, if found suitable, by the ECC. To a proposal by the Ministry of Industries and Production, the ECC constituted an inter-ministerial committee under the chairmanship of Minister Planning, Development and Reforms and comprising Adviser to Prime Minister on Industries and Production, Special Assistant to Prime Minister on Petroleum, Secretary Finance, Secretary Industries and Production and Chairman FBR for preparation of a policy framework for promotion of steel and iron in the country through foreign direct investment.

    The ECC also considered a proposal by the Ministry of Communications that all cash development loans and foreign loans, whether direct or relent, including interest accumulated thereon, received up to June 30, 2019 by the National Highway Authority be converted into government grant or the Government of Pakistan may either “write-off” the said loans while for future, all PSDP allocations including relent/direct loans, both rupee and foreign exchange component i.e. for non-commercially viable projects and for strategic/defence roads to NHA may also be provided as government grant.

    The proposal also sought the CDL may be advanced only for commercially feasible projects on which Finance Division and NHA mutually agree regarding the terms and conditions of the loan and its repayment or these viable projects may be undertaken by NHA in PPP/BOT mode of financing.

    The ECC discussed the proposals and in view of input from the members constituted a committee comprising Minister for Planning, Development and Reforms, Secretary Finance, Secretary Communications, Secretary Economic Affairs Division and Deputy Chairman Planning Division to examine the proposals and submit their recommendations to the ECC.

    The ECC also took up a proposal from the Ministry of Industries and Production for a technical supplementary grant of Rs 6 billion to the Utility Stores Corporation (USC) for subsidy and procurement of essential commodities, including flour, ghee/oil, rice, sugar and pulses, to be sold at a fair price to the poor segment of the society.

    The ECC discussed the issue in detail and in view of input from the members, asked the Utility Stores Corporation to prepare within the next few days a practical and comprehensive mechanism involving use of information technology to ensure the disbursement of specific food items to the poorest of the poor.

    The ECC also constituted a committee comprising Adviser to Prime Minister on Industries and Production, Governor State Bank of Pakistan, Benazir Income Support Programme Chairperson and representatives from NADRA and PPRA to advise and assist the USC to firm up their proposals and present them to ECC.

  • ECC approves Rs30bn for redemption of sales tax refund bonds

    ECC approves Rs30bn for redemption of sales tax refund bonds

    ISLAMABAD: The government has approved Rs30 billion for redemption of sales tax refund bonds issued by the Federal Board of Revenue (FBR).

    The Economic Coordination Committee (ECC) of the Senate in a meeting yesterday took up a proposal by FBR and approved a technical supplementary grant to the tune of Rs 30 billion for the redemption of bonds issued by the “FBR Refund Settlement Company Limited” to the tune of Rs 30 billion, and payment of sales tax refunds by FBR in the form of cheques in accordance with the prescribed rules.

    The ECC also approved a proposal by the Commerce Division for declaration of the erstwhile zero-rated sectors, namely Textiles (including jute), carpets, leather, sports and surgical goods as “Export Oriented Sectors, which includes Textiles, Carpets, Leather, Sports and Surgical Goods”.

    On another proposal by the Ministry of Information Technology & Telecommunication for exemption of 8 percent minimum Income Tax for National Telecommunication Corporation, the ECC constituted a body comprising Minister for Economic Affairs Division Muhammad Hammad Azhar, Minister for Information Technology & Telecommunication Khalid Maqbool Siddiqui, Chairman Board of Investment and a representative from FBR to review the proposal and present suitable recommendations to ECC.

  • Simplified tax regime for non-residents approved: Dr. Hafeez Shaikh

    Simplified tax regime for non-residents approved: Dr. Hafeez Shaikh

    ISLAMABAD: The Economic Coordination Committee (ECC) on Wednesday approved a simplified tax regime to facilitate the non-resident companies for investment in the local capital market.

    Dr. Abdul Hafeez Shaikh, Advisor to Prime Minister on Finance said that the ECC had approved a simplified tax regime to facilitate the non-resident companies for investment in the local capital market.

    Dr. Abdul Hafeez Shaikh said that these incentives will increase the foreign exchange inflows and reserves of the country.

    A statement issued after the ECC meeting stated that the meeting has approved separate proposals for simplification of tax regime for non-resident companies investing in the local debt market, revision of cess rate on tobacco for the year 2019-2020 and payment of outstanding amount of Rs 5.85 billion as gas subsidy to the fertilizer industry.

    The approvals were given at a meeting of the ECC which met here at the Cabinet Block with Adviser to the Prime Minister on Finance & Revenue Dr. Abdul Hafeez Shaikh in the chair.

    The ECC was also briefed on the wheat situation in the country and it was pointed out that while prices were stable in most parts of the country, there were certain areas and places such as Karachi where the wheat and flour prices had escalated.

    The ECC directed the Ministry of National Food Security and Research to sit down with all stakeholders and ensure that the situation does not get out of hands and supply of wheat and flour at regular prices is ensured.

    The ECC also considered a proposal by the Ministry of Energy for application of quarterly adjustment notified on 1st July 2019 to the zero rated industrial consumers and for it to be charged over and above the notified tariff for zero rated industrial consumers at 7.5 cents as well as a proposal to the effect that Financial Cost Surcharge, Neelum Jhelum Surcharge, taxes and positive fuel adjustments would not be part of billing to zero rated sector industrial consumers and would be part of subsidy claims to be picked by the Government of Pakistan.

    The Committee discussed the pros and cons of the proposal in view of its financial implications and asked the Finance Division to hold a meeting with the stakeholders, including the Power Division, Commerce Division and Industries & Production Division and resubmit the case to ECC with solid proposals.

    The ECC also approved proposals submitted by the Ministry of Finance for simplification of tax regime for non-resident companies investing in the local debt market with a view to deepening the country’s capital markets, reducing the cost of debt for the government and increasing foreign exchange inflows and reserves.

    The new tax regime as approved by the ECC would apply to the non-resident companies having no permanent presence in Pakistan.

    The ECC also took up a proposal for extension and rehabilitation of gas network in the oil and gas producing districts of Khyber Pakhtunkhwa and referred the matter to the Development Working Party headed by the Secretary Petroleum for an appropriate decision.

  • ECC approves 10 percent regulatory duty on cotton import

    ECC approves 10 percent regulatory duty on cotton import

    ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet on Wednesday approved imposition of 10 percent regulatory duty on import of cotton.

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  • ECC bans export of wheat to control domestic prices

    ECC bans export of wheat to control domestic prices

    ISLAMABAD: Economic Coordination Committee of the Cabinet (ECC) on Wednesday decided to impose ban on export of wheat and related products in order to control prices in the local market.

    Adviser to Prime Minister on Finance and Revenue, Dr. Abdul Hafeez Shaikh, chaired the meeting of the ECC.

    A report on the wheat situation in the country was presented in the ECC by Ministry of National Food Security and Research.

    It was briefed during the meeting that adequate stocks of wheat are available in the country to cater for the needs of the population.

    It was also highlighted that the procured quantity of wheat during this year is 33% less than the procured quantities of wheat during the corresponding periods of last year.

    “The recent hike in prices of wheat and wheat flour is also a point of concern. The ECC decided to impose a ban on export of wheat/wheat flour and also asked that a meeting of National Price Monitoring Committee may be convened to suggest measures to control the price hike trend of ‘Roti’ and other wheat products in the local market with the cooperation of the provincial governments,” said a statement.

    The ECC also approved National Fertilizer Marketing Limited (NFML) to fix the Dealer Transfer Price (DTP) of 50 kg imported Urea Bag at Rs.1800 which is Rs.166 less than the prevailing average market price of Sona Urea i.e. Rs.1966 per 50 kg bag.

    The difference in Urea import price and approved dealer transfer price for NFML dealers has been estimated at Rs.937.92 million; NFML has also been directed to ensure enforcement of this price through coordination with provincial governments.

    The ECC allowed PIA Corporation Limited to make a re-appropriation in its already approved budget of Rs.24 billion for the upgradation of in-flight entertainment (IFE) system of its fleet for 8 Boeing-777 aircrafts. The project will cost Rs.700 million.

    It was also briefed during the meeting that the measures will improve the occupancy of the airline to 80 per cent from the current level of 70 per cent.

    The ECC endorsed the decision of the Governing Council of Pakistan Bureau of Statistics to change the base of price statistics from 2007-08 to 2015-16.

    The new base 2015-16 of price statistics has the following features:

    Inclusion of rural market.

    Introduction of population weight based on recent Population Censes 2017.

    Computation of indices based on Weighted Geometric Mean.

    Introduction of consumption quintiles instead of income quintiles.

    Introduction of consumer weighted approach to compute gas prices for combined income group.

    Introduction of GST, other taxes Fuel Price Adjustment to compute electricity tariffs using consumer weighted approach.

    It was also decided that for the purpose of comparative analysis, the old series of 2007-08 will continue to be published for another year along with the new series of 2015-16.

    On the summary moved by Ministry of Commerce and Textile, it was decided that the scrap slag, ash and residues containing metals, arsenic or their compounds (containing mainly Aluminum under PCT 2620.4000) may be moved from Appendix-A (Banned Items) to Appendix-B (Restricted Items) of the Import Policy Order, 2016.

    However, in order to forestall the chances of import of hazardous waste, the import may be subject to the following conditions:

    (i) Importable only by industrial consumer having recycling facilities, subject to NOC from Ministry of Climate Change and duly certified by provincial Environmental Protection Agency (Federal EPA, in case of Islamabad Capital Territory).

    (ii) Provision of a pre-shipment Inspection Certificate and consent of Focal Point of Basel Convention from the country of export to the effect that the waste/scrap is non-hazardous as defined in the Basel Convention.

    (iii) The imported consignments of the registered recycling plants shall be cleared from seaport only.

    The ECC also considered and approved the notification of Minimum Indicative Prices (MIP) of tobacco for year 2019-20.

    As per section 8 of the Pakistan Tobacco Board Ordinance 1968, the MIP for different grades of various types of tobacco are to be notified by the Federal Government.

    The following prices were suggested for notification: S.No. TYPES OF TOBACCO MINIMUM INDICATIVE PRICE PER KG FOR 2019-20 CROP 1. FCV Tobacco (Plain) Rs.190.63 2. FCV Tobacco (Sub-Mountainous) Rs.218.77 3. WP Tobacco Rs.82.85 4. Burley Tobacco Rs.150.54 5. DAC Tobacco Rs.94.76.

    The ECC also allowed that new PCT codes, as created in the Pakistan Customs Tariff through the Finance Act, 2019, may also be incorporated in SRO 693(I)/2006 dated 01.07.2006 so that levy of additional customs duty collected on those parts of Sport Utility Vehicles (SUVs) of engine capacities 1001cc to 1500cc and 1501cc to 1800cc which have been localized, may be appropriately accounted for under separate PCT codes.

    The report on National Poverty Graduation Programme of US $ 82.60 million was also submitted for compliance of the ECC by the Secretary, Economic Affairs Division.

    Among others, the meeting was attended by Minister for National Food Security & Research, Sahibzada Muhammad Mehboob Sultan; Minister for Planning, Development& Reform, Makhdoom Khusro Bukhtiar, Minister for Privatization, Muhammadmian Soomro, Minister for Railways, Sheikh Rashid Ahmed, Adviser to PM on Commerce, Textile, Industry & Production and Investment, Abdul Razak Dawood; Adviser on Institutional Reforms and Austerity, Dr. Ishrat Hussain; SAPM on Petroleum, Nadeem Babar; Governor State Bank of Pakistan, Reza Baqir and Chairman, Board of Investment, Zubair Gilani.

  • ECC approves tax incentives to shipping industry for next 10 years

    ECC approves tax incentives to shipping industry for next 10 years

    ISLAMABAD: The Economic Coordination Committee of the Cabinet (ECC) on Wednesday extended tax incentives to shipping industry for next 10 years.

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  • ECC approves Rs20 billion fund to support stock market

    ECC approves Rs20 billion fund to support stock market

    ISLAMABAD: The Economic Coordination Committee of the Cabinet (ECC) on Thursday approved State Enterprise Fund worth Rs20 billion to support the stock market of the country.

    Adviser to Prime Minister on Finance, Revenue and Economic Affairs, Dr. Abdul Hafeez Shaikh, chaired the meeting of the Economic Coordination Committee (ECC) of the Cabinet.

    In order to stabilize the stock market of the country, the ECC approved the proposal of Finance Division authorizing Government of Pakistan to issue sovereign guarantee amounting to Rs20 billion for investment in National Investment Trust (NIT)-State Enterprise Fund.

    Secretary, Ministry of National Food Security and Research updated the Committee about the wheat situation in the country.

    He informed that the country was in comfortable position with having 7.257 million tons of wheat available in the stock.

    Ministry of Maritime Affairs suggested various proposals on the revival and development of shipping industry in Pakistan.

    The Committee noted the proposals and advised Ministries of Petroleum and Maritime Affairs to jointly come up with a comprehensive proposal, in next ECC meeting, for introducing a dynamic shipping policy focusing on expansion and development of local shipping industry.

    The ECC acceded to the proposal of Ministry of States & Frontier Regions to grant Rs.781,591,000/- for arranging 20,000 Metric Tons of wheat for Temporarily Displaced Persons of erstwhile FATA.

    The ECC also approved Supplementary and Technical Supplementary Grants for various Ministries/Divisions.

  • ECC reduces sales tax on petrol by 5 percent

    ECC reduces sales tax on petrol by 5 percent

    Islamabad: The Economic Coordination Committee of the Cabinet (ECC) has taken a significant step towards providing relief to the masses by approving a reduction of sales tax by five percent.

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  • ECC may approve sovereign guarantee for Utility Stores Corporation

    ECC may approve sovereign guarantee for Utility Stores Corporation

    ISLAMABAD: The Economic Coordination Committee of the Cabinet (ECC) may grant formal approval for sovereign guarantee for Utility Stores Corporation (USC) in its meeting scheduled for April 17, 2019.

    According to agenda of the ECC meeting scheduled for Wednesday, the ministry of industries and production had proposed for the sovereign guarantee for the public sector store chain in order to overcome its financial crisis.

    The USC is providing consumer items at low priced and subsidized rates to masses. The government has also approved an amount of Rs2 billion for Ramazan package to be provided to masses through the USC.

    In other agenda items, the ECC may approve an amount of Rs700 million in favour of National Commission for Human Development under the ministry of federal education and professional training.

    A supplementary grant of Rs337.02 million likely to be approved in respect of Gilgit-Baltistan Council for Financial Year 2018/2019.

    Provision of supplementary grant of Rs1.33 billion to department of immigration and passport likely to be approved.

    Further, on the recommendation of petroleum ministry, the ECC likely to approve utilization of Railways services by PSO for transportation of petroleum products.

  • ECC approves import of 100,000 tons of urea

    ECC approves import of 100,000 tons of urea

    ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet on Wednesday approved immediate import of 100,000 tons of urea to facilitate farmers.

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