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ECC suspends 25% regulatory duty on potato export, approves 650,000 tonnes of sugar export

ECC suspends 25% regulatory duty on potato export, approves 650,000 tonnes of sugar export

ISLAMABAD: The federal cabinet’s Economic Coordination Committee (ECC) on Wednesday lifted the 25% regulatory duty on the export of potato and approved 650,000 tonnes of sugar export quota.

Finance Minister Ishaq Dar on Wednesday chaired meeting of the Economic Coordination Committee of the Cabinet at the Prime Minister’s Office. On a proposal from the Ministry of National Food Security & Research the ECC lifted the 25% regulatory duty on the export of potato paving way for its export. The chair was informed that farmers had planted the crop on ten percent larger area this year and abundant yield was on the cards, surely creating a surplus. The decision would come into force w.e.f from December 20. The chair while allowing lifting of duty, with consensus of the house directed for formation of a committee comprising Secretary Commerce and Secretary National Food Security to closely monitor the market situation and keep the ECC updated regularly. “Interest of the local consumers is also to be kept in view”, Finance Minister remarked.

The ECC approved Ministry of Water and Power’s proposal regarding Modified Policy Framework for on-site private power projects based on interim gas supply with amendments as highlighted by Ministry of P&NR and FBR. The Federal Board of Revenue made it clear that no new SRO will be issued to facilitate the on-site power projects, however they may avail benefits under existing provisions. It was also agreed that to secure payment of gas supplies, sellers will provide a Bank Guarantee or standby letter of credit, equal to mutually agreed period’s payment of fuel component tariff, issued by a scheduled bank.

On a proposal moved by the Ministry of Water and Power, the ECC approved the proposed agreement between TPS Guddu (GENCO- II) and M/s Engro for use of 60MMCFD gas from Mari shallow by M/s Engro till December 2015 in lieu of gas booster compressors to be installed by Engro for GENCO-II. On another proposal brought to the ECC by Ministry of W&P, the ECC approved public disclosure of “Pakistan Energy sector Reform-Quarterly Progress Report of Development Policy Operations”. ADB, Asian Development Bank, JICA and WB supported GOP’s initiative and developed a sectoral reform program through the Government of Pakistan. The plan covers tariff management, improvement of sectoral performance, incentivizing private sector participation and improvement of accountability and transparency. The program is spread over 5 years. The first quarter review of the program was presented to the ECC and the progress report was discussed in detail. ECC was informed that all tasks required under the program in first year have been successfully completed.

Earlier at the outset of the meeting, Secretary Cabinet informed that an Implementation Cell had been established at the Cabinet Division in line with the instructions of the Chair to ensure implementation of the decisions taken by the esteemed forum. The Finance Minister would be given an update on the implementation status at every ECC meeting, the Cabinet Secretary said.

In another development, the ECC also approved the export of an increased quota of 650,000 tons of sugar till May 15, 2015 — up from the current level of 500,000 tons. The ECC was informed that there are ample stocks, amounting to 1,050,000 tons, available in the country — sufficient to meet domestic requirements at a consumption rate of 390,000 tons per month till March 15, 2015.

As sugar prices have plunged to Rs38 per kg in the world market, the government decided to give a subsidy of Rs10 per kg. The ECC allowed inland freight subsidy at Rs2 per kg and cash subsidy Rs8 per kg on its export. The total amount of subsidy would be Rs6.5 billion, which would be paid equally by the centre and provinces. The ECC also imposed 20% regulatory duty on the import of raw and beet sugar and fixed the minimum price for export to Afghanistan and Central Asian States at $450 per ton.