MUSHTAQ GHUMMAN

ISLAMABAD: The Cabinet has constituted an inter-ministerial committee headed by Minister for Privatisation, Daniyal Aziz to prepare recommendations for revision in Produce Index Unit (PIU) for amendment to the Loans for Agriculture, Commercial and Industrial Rules, 1973, official sources told Business Recorder.

On January 16, 2018, a Cabinet meeting presided over by Prime Minister Shahid Khaqan Abbasi, was informed by the Finance Ministry that one of the initiatives announced by Finance Minister in his budget speech for FY 2017-18 pertained to the enhancement of the rate of Produce Index Unit (PIU) from Rs4,000 to 5,000. The initiative is aimed at facilitating the farmers to obtain maximum credit from banks.

According to sources,  the Cabinet was apprised that as per Section 5(1) of the Loans for Agricultural, Commercial and Industrial Purposes Act, 1973, the federal government or, if the federal government so directs, the provincial government may, by notification in the official Gazette, make rules for carrying out the purposes of this Act. Accordingly, Loans for Agricultural, Commercial and Industrial Purposes Rules, 1973 were framed.

The sources further stated that in order to implement the initiative, the following amendments were being proposed in the Loans for Agricultural, Commercial and Industrial Purposes Rules, 1973: (i) in rule 5, in sub-rule (2), for the words “four thousand”, the words “five thousand” shall be substituted; and (ii)

in schedule 1, in form 2, in column 14, for the figure “4000”, the figure “5000” shall be substituted.

The cabinet was briefed that the draft notification had been vetted Law & Justice Division and the Cabinet Committee for Disposal of Legislative Cases (CCLC), in its meeting held on November 2, 2017, had recommended the proposal for approval of the cabinet.

In terms of rule 17(1) of the Rules of Business 1973, ratification of the cabinet was solicited to the recommendations of the Cabinet Committee for Disposal of Legislative Cases (CCLC) in respect of the Loans for Agricultural, Commercial and Industrial Purposes Rules, 1973.

During discussion in the federal cabinet on January 16, 2018 it was observed that the Production Index Unit (PIU) was fixed as Rs.4000 in 1973 and it was unfair to increase it to Rs.5000 after a lapse of so many decades; and that this was tantamount to discrimination against the agrarian economy.

Some of the cabinet members proposed that instead of PIU, market rate or DC rate should be adopted as a criterion for granting loans to the agricultural sector. It was further observed that it was a complicated issue which needs to be examined in depth.

After detailed discussion, the federal cabinet constituted a committee with Daniyal Aziz, Minister for Privatization as Chairman, Sardar Awais Ahmed Khan Leghari, Minister for Power, Member, Syed Javed Ali Shah, Minister for Water Resources, Member, Haroon Akhtar Khan, Special Assistant to Prime Minister on Revenue, Member and Secretary, Finance Division, Secretary.

The committee will submit its report to the cabinet within a period of two weeks.