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ECC to approve inland sugar subsidy today




  • The Economic Co-ordination Committee (ECC) of the Cabinet which is scheduled to meet on Wednesday (today) with Finance Minister Saleem Mandviwala in the chair will approve inland subsidy of Rs 1.75 per kg on 1.2 million tons of sugar, official sources told Business Recorder

    Earlier, the ECC meeting which was presided over by former finance minister Abdul Hafeez Shaikh had approved Rs 8 billion incentives on export of 1.2 million tons sugar on summaries prepared by the Commerce Ministry and the Federal Board of Revenue (FBR). 

    However, the SRO issued by the FBR favoured sugar mills of Sindh zone. According to sources Punjab produces 60 percent and KP 10 percent of overall sugar output in the country. The exclusion of both provinces has been strongly lamented by the industry as the SRO only favours one province. This SRO is being challenged in the court as discriminatory in nature and the major quantum of growers” payments relates to Punjab. If KP and Punjab mills try to export through Karachi port for destinations other than Afghanistan and CIS it costs over $20 dollars in terms of haulage and it is practically impossible to export. 

    The entire purpose of export facilitation is to support price of sugar in the local market as industry is not at a break even given the current level of sugar prices and if there is no outlet for sale of Punjab and KP there will be a serious chaos in payments to sugarcane growers. The MoI, sources said, would take up the issue at the highest level to provide a level playing field to all the provinces. 

    The ECC will also approve amendments to LPG (production and distribution) policy guidelines 2013, blending of ethanol into motor gasoline (E-10) and pricing by Ogra, policy framework for upgradation and expansion of refinery projects, acquisition and rehabilitation of DHA Cogen Limited (power and desalination plant) by international electric power and change in composition of business express. 

    Copyright Business Recorder, 2013

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