Economic Coordination Committee approves Ramadan Relief Package

Islamabad: The Economic Coordination Committee of the Cabinet which met here today with the Federal Minister for Water and Power, Syed Naveed Qamar in the chair has approved a number of summaries including Relief Package for the Holy Month of Ramadan 2011, Furnace Oil Blending in Pakistan, Uniform Gas Load Management Policy, Relending of KFW Loan for Keyal Khawar Hydro Power Project in accordance with new relending policy of the Government, Tax exemption for WAPDA for Second Sukuk Company Limited, 1100 MW Kohala Hydro Power Project and additional security issues of Uch Power Private L:imited and extending NOC for awarding of contract to KRL for the development of Uch-II Development Project.

The Economic Coordination Committee in order to extend relief to the people during the month of Ramadan accepted the summary proposed by the Ministry of Industries which sought a special subsidy upto Rs.2 billion to ensure the uninterrupted availability of essential food items which include Atta, ghee, oil, dal channa, white channa, basin and dates at reduced prices to be available at the Utility Stores Corporation throughout the country.

On the summary moved by the Ministry of Petroleum and Natural Resources the ECC approved Furnace Oil Blending in Pakistan. By this project blending technology, socio-economic benefits, additional employment opportunities leading to increased investment in oil sector will be added. It may be added here that this is for the first time, the blending of furnace oil technology will be introduced in country by this approval. Pakistan has already sufficient infrastructure to blend high viscous. The ECC directed the Ministry of Petroleum and Natural Resources to ensure proper monitoring system at the time of blending and SOPs be drawn. The monitoring system shall function under the supervision of OGRA and Hydro Carbon Development Institute of Pakistan and the IPPs shall be its consumers.

After much deliberations and discussions on the Uniform Natural Gas Load Management Policy proposed by the Ministry of Petroleum and Natural Resources to the ECC, it was decided that gas supply to two IPPs to continue for the coming five months and the other two IPPs shall be asked to resort to other fuels on which the price differential shall be given to them. The approved summary on natural gas load management policy has proposed curtailment of CNG supply to CNG stations for three and two days for the Provinces of Punjab and Sindh respectively. The gas saved by the proposed curtailment shall be used for power generation in Sindh and to facilitate fertilizer, industrial and power sector in Punjab on equitable basis so that consistent supply of power is ensured. This proposal shall further be discussed in the Cabinet also in the coming days.

Relending of Keyal Khawar Hydro Power Project has also been approved by the ECC.

The request by the Ministry of Petroleum and Natural Resources for the revision in gas sale prices, the committee deferred the proposal for the next two or three days so that the matter may be discussed at the Cabinet level or with the Prime Minister. The committee, however, accepted the economic rationale for the revision of gas sale prices and for the removal of distortion in the prices.

Tax exemption for WAPDA Sukuk Company has already been approved by the Ministry of Finance which has granted exemption for the payment of income tax.

The ECC also approved modification of tariffs by NEPRA allowing operation of gas based IPPs on back up fuel (HSD) with full cost recovery, whatever period gas is not available to them.

The ECC accorded no objection certificate to the Ministry of Petroleum and Natural Resources for award of UCH-II development project to be undertaken by the (KRL) Khan’s Research Laboratories. The summary for this project was earlier submitted to the Prime Minister who desired that the same may be discussed at the ECC for decision. KRL has already shown its acceptance to undertake this project by lowest bidding and fast track its completion within the stipulated time. Additional security issues for Uch Power Project was also approved by the ECC.

This was the first Economic Coordination Committee of the Cabinet meeting after the budget 2011-12 has been passed by the Parliament, which discussed at length more than twelve agenda items, and was attended by the Federal Ministers and Secretaries of the concerned ministries.

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