Finance minister chairs meeting of Economic Coordination Committee of Cabinet

Islamabad, March 27, 2014 (PPI-OT): The ECC of the Cabinet met here today under the Chairmanship of the Federal Minister for Finance, Senator Mohammad Ishaq Dar at the Prime Minister’s Office today.

The ECC considered and approved the summary of the Ministry of Commerce for export of 250,000 Metric Tons of sugar by sugar mills from surplus sugar stock on the following conditions:

1. Quota will be allocated on first come first served basis.

2. Export may be made against irrecoverable letter of credit or a contract with 25% non-refundable advance payment.

3. Shipment may be made within 45 days of the registration of contract with the SBP, and the non-refundable advance payment to be forfeited in favour of Government of Pakistan in case of non-performance.

The Finance Minister also directed Ministry of Industries and Production to ensure outstanding payments to sugar cane growers by sugar mills in coordination with the provinces.

The ECC considered and approved the summary of the Finance Division for import of 0.125 million tons of urea fertilizer for the incoming Kharif (April to September Season) 2014 in order to meet the demand as recommended by the Ministry of National Food Security.

This import will not impact our foreign exchange reserves as the same will be imported through ITFC. The Finance Minister on the occasion said that the earlier decision of the ECC to maintain the retail price of Rs.1786 per bag must be ensured in the local market.

He said that the Ministries of Food Security and Industries and Production should work in coordination with the provinces for the agreed price. The ECC also constituted a four-member Committee comprising Ministers for Water and Power, Petroleum and Natural Resources, Food Security and Industries and Production to sort out the issue of supply of required gas to the local urea manufacturers.

The ECC considered and approved the summary of the Ministry of Water and Power for utilization of the existing available generation capacity from short term IPPs subject to the fact that it is not in violation of the Supreme Court’s Judgment dated 30.3.2012.

It may be mentioned that the power generation equipments imported under another scheme was declared illegal by the Supreme Court of Pakistan in its judgment dated 30.3.2012. In order to avoid obsolescence of such plants and machinery and to avoid monetary claims under arbitration, these plants and machinery can be utilized to add 200MW of generation.

The ECC directed that the project company shall obtain generation license and tariff determination from NEPRA; Terms and conditions of the tariff shall be determined by the NEPRA; Tariff shall be based on take and pay basis and electricity actually delivered to the national grid; Short term IPPs may have an option to sell electricity to the bulk consumers like housing societies, industrial parks, etc. without the government guarantees and obligation of the public entities to buy all of the generated electricity; Term of the Power Purchase Agreement shall be 3 year; Draft PPA shall be prepared by the NTDCL for short term IPPs for approval of the ECC.

No objection from NAB for utilization of plant and machinery. Unconditionally and irrecoverable waiver of claims of arbitration against the GOP and its entities shall be eligible under the short term IPPs framework.

The ECC considered and approved the summary of the Aviation Division for release of an amount of PKR equivalent to 29.9 million US dollars to PIAC for acquisition of aircrafts on dry lease. PIA intends to lease eight A320S offered by Qatar Aviation Lease Company through international tender.

These aircraft will be available from April 2014. The Finance Minister directed the management of PIA that they cannot go outside the tender and ensure that all the requirements are met and relevant rules must be followed.

The ECC also considered the summary of the Ministry of Commerce regarding lifting of ban on the import of gold. The ECC directed the Commerce Ministry to resubmit the summary, incorporating guidelines provided by ECC, in the third week of April for consideration.

The meeting was also attended by Khawaja Mohammad Asif, Minister for Water and Power, Mr. Sikandar Hayat Bosan, Minister for National Food Security, Mr. Ahsan Iqbal, Minister for Planning, Development and Reform, Mr. Ghulam Murtaza Khan Jatoi, Minister for Industries and Production, Mr. Shahid Khaqan Abbasi, Minister for Petroleum and Natural Resources, Federal Secretaries and senior officials of the government.

For more information contact:
Ministry of Information and Broadcasting
4th Floor, Cabinet Block, Pak. Secretariat,
Islamabad, Pakistan.
Fax: 00-92-51-9206399

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