The Economic Co-ordination Committee (ECC) of the Cabinet chaired by the Finance Minister Saleem Mandviwalla on Wednesday approved inland freight subsidy of Rs 1.75 per kg for 1.2 million metric tons of sugar. Sources said that the inland freight subsidy on sugar would have an impact of Rs 2.1 billion on the exchequer. The ECC meeting chaired by the Finance Minister considered the summary and approved without any debate and discussion as no one raised any objection to the proposal.
The Committee was informed that there is slow pace in sugar export and keeping in view the industry”s liquidity position for paying dues to farmers, inland freight subsidy of Rs 1.75 per kilogram may be extended to the export of total quantity of 1.2 million MT of sugar instead of 0.895 million MT allowed for export through an earlier decision of the ECC. The ECC meeting was having heavy agenda which could not be completed as the Finance Minister has to rush to attend another meeting in the Prime Minister House, sources added. They further stated that another ECC meeting is expected to be held on Friday or Tuesday to take up remaining agenda.
The ECC also approved a summary of Ministry of Railway seeking exemption of all foreign and local components of the Karachi Circular Railway (KCR) from imposition of general sales tax, customs duty and other federal levies. Sources said that the Federal Board of Revenue (FBR) was not supportive of the exemption due to policy stance against the exemptions. An official of the FBR was quoted as saying that granting exemption even for one time would be against the policy; however, the ECC is a competent forum for taking any decision. The summary was moved by Ministry of Railways to seek the approval of ECC for waiver off general sales tax and customs duty on the component of the project. The meeting was informed that the KCR is a mega project of national importance and aims to provide modern rail-based commuter service to the citizens of Karachi with a total cost of US $2.6 billion. ECC was informed that Japan International Co-operation Agency will provide $2.4 billion on a 0.2 percent mark up payable in 40 years, including 10 years grace period.
The ECC approved a summary moved by the Finance Division soliciting approval for equity investment in Democratic Republic of Congo. The meeting was informed that the State Bank of Pakistan evaluated the proposal and recommended that M/s Lucky Cement Limited may be allowed to remit $40 million on account of equity investment in connection with establishment of cement manufacturing plant through incorporation of Joint Venture Company with the condition that the company will manage foreign exchange requirements from the open market and the outflow will be co-ordinated with the State Bank of Pakistan.
The ECC also approved a proposal of the Federal Board of Revenue (FBR) that the areas of Hub and Hattar may be included in the ambit of DTRE scheme available to ghee manufacturers-cum-exporters based in KPK and Balochistan. Sources said that a representative of KPK chamber of Commerce and Industry was also invited by the Minister for Finance for giving briefing to the meeting.
Minister for Railways, whose family is a big name in ghee industry in KPK, was vocal supporter of the proposal. Subsequently, the ECC further approved withdrawal of the condition of export performance of last four years plus 20 percent enhancement and allowed the manufacturers-cum-exporters of ghee to acquire the quantity of raw material required for manufacture and export of 1000 MT of ghee only. The summary for subject approval was forwarded by FBR.
The ECC approved “Framework for Power Cogeneration 2013 (Bagasse/Biomass)” as an addendum to the Renewable Energy Policy 2006. This framework shall be effective for all high-pressure cogeneration projects utilising bagasse/biomass. The ECC also approved extension of Renewable Energy Policy 2006 for an additional five years. The summary was moved by Ministry of Water and Power.
