ZAHEER ABBASI
ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet decided to approve government guarantee of Rs 12 billion for Pakistan International Airlines (PIA) and extended the grace period by another two years for syndicated terms finance facility of Rs 136.45 billion for Power Holding (Pvt) Ltd.
Sources said the PIA would procure a loan from Burj Bank and terms and conditions in this regard would be determined in consultation with Finance Ministry. They added that the ECC was submitted a proposal on the critical liquidity situation of the PIA. A participant of the meeting claimed that the ECC has also approved increase in margins and commissions of Oil Marketing Companies and dealers; however, Finance Ministry did not say anything about it in its press release.
According to a statement issued by Finance Ministry, the ECC meeting chaired by Finance Minister Ishaq Dar Thursday decided to impose a 20 percent regulatory duty on the import of wheat with immediate effect with a view to discouraging the growing trend of import. The meeting was told that the wheat crop at home is very good, according to a statement.
The ECC held a detailed discussion on the draft textile policy and wanted improvements in various proposals given in the draft. The ECC constituted a committee headed by Minister for Planning and Development and Ministers for Food Security, Textile, and senior representatives of Finance Ministry as its members to review the policy by mid-November before submission to the ECC for reconsideration. The ECC accorded its approval, in principle, for the restructuring of Pakistan Central Cotton Committee (PCCC) with the assurance from the Textile Ministry that establishment of the headquarters of the Committee at Multan would not require any funding from the government. The chair also asked the Ministry of Textile to share its business plan, a key feature of the restructuring plan, and get clearance for service rules and regulations from the Regulation Wing of the Finance Ministry.
The ECC considered the draft Policy Framework for Private Sector Transmission Line Projects submitted by Ministry of Water and Power with views of Federal Board of Revenue (FBR) and Nepra regarding certain provisions of the policy. The ECC approved corporate tax exemption for ten years with instructions that the companies concerned would file tax returns. An exemption was allowed on turnover tax for a period of ten years; withholding tax on income was also exempted.
The ECC, however, decided that withholding of GST on imports will be leviable and adjustable. It was decided that Nepra will finalise a tariff petition within a month for transmission lines without re-opening of tariff obtained through an international competitive bidding.
The ECC accorded its approval to a proposal from Ministry of Water and Power about a policy framework for on-site projects based on interim gas supply with slight amendments. The proposal aims at interim utilization of over 200 million cubic feet per day (MMCFD) of natural gas available at various gas fields which cannot be injected into the pipeline system in the near future due to the time requirement for establishment of gas production. Ministry of Petroleum and Natural Resources would provide details of the gas available with other specifications.
