ISLAMABAD: The Economic Coordination Committee of the Cabinet on Wednesday approved a $130 million bailout package for the cash-starved Pakistan International Airlines to help it weather the...
ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet on Wednesday approved a $130 million bailout package for the cash-starved Pakistan International Airlines (PIA) to help it weather the coronavirus crisis and maintain operations in the midst of a year-long halt to international travel.
"The ECC considered and approved cash support as required by PIAC," a government statement said.
Minister for Finance and Revenue Shaukat Tarin presided the meeting of ECC.
"The airline has experienced significant dip in revenues and cash flows due to pandemic and unprecedented travel bans/lockdowns imposed by various countries."
The ECC also jacked up existing approved guarantees enabling the national flag carrier to overcome its financial difficulties.
The airlines had reduced its operational losses to Rs680 million in 2020 from Rs6.130 billion in 2019, which would have been easily covered if revenue streams had not also fallen by nearly 35.7 percent, according to PIA's audited financial results for the year 2020.
PIA achieved a revenue of Rs94.989 billion, down from Rs147 billion achieved in 2019, the main reason for which was Covid-19 restrictions affecting all of PIA routes, reducing the overall operations by nearly half.
The pandemic which hit the industry in March 2020 saw nearly halting all the operations, domestic and international for months, which only started to resume partially from July onwards.
The ECC also approved technical supplementary gGrants for Pakistan Army for placing fencing on Pak-Iran border during the current fiscal year. The ECC also approved two other supplementary grants for the Special Security Division (South) and North for the current fiscal year.
The statement said the ministry of Industries and Production presented a summary requesting for provision of RLNG to SNGPL based plants (Agritech and Fatima Fertilizer) during Rabi season 2021-22.
The ECC approved provision of 70 MMG RLNG with the direction to hold a consultative session with the representatives of fertilizer manufacturers to work out overall demand for urea in the country.
The ECC further directed to consider the possibility to import urea, if needed, to maintain buffer stocks.
The ministry of Commerce presented a summary regarding revocation of the conditions of minimum export price (MEP) on export of surgical instruments with the exception of “single-use” surgical instruments. "After due deliberation, the ECC approved that the necessary amendments be made in Export Policy Order, 2020 to revoke the condition of MEP in order to make exports competitive in the global market," the statement said.
Ministry of Food Security and Research submitted a summary for provision of wheat to Azad Jammu and Kashmir, out of PASSCO stock, for the financial year 2021-22.
The ECC approved the provision of 300,000 MT of wheat to AJ&K at the ratio of 80/20 as mixture of local/imported stock.
Finance minister Tarin said the government is firmly committed to stabilize prices of wheat and ensure its smooth supply at affordable prices across the country.
The statement said the ECC also approved Rs3,860 million in favour of Revenue Division (FBR) as a bridge financing facility to upgrade IT infrastructure in view of increased frequency and severity of cyber attacks to ensure elimination of risk to taxpayers data.