ECC grants approval for revision of imported urea price

ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet under the chairmanship of Minister for Finance Ishaq Dar has granted approval for revision in imported urea price and allowed to fix dealer transfer price of 50kg imported bag at Rs2,340 per bag. The incidental charges of urea is fixed at Rs594 at the Karachi Port Trust and Rs1,008 per bag at Gwadar.

According to official sources, it was brought to the notice of the government the average market price of urea fertiliser stood at Rs2,543-2,678/bag, which is approximately Rs103-238/ bag above the price notified by the private companies. Further, the SNGPL-based plants have been shut down, creating a psyche of shortage in the market. The ECC further directed that the 50pc of subsidy for imported urea should be shared by the provinces.

The imported urea ships have arrived and currently the imported urea is shifted to NFML’s store. The sale of imported urea is expected to augment the difference in demand and supply and stabilise the prices in the market. The fixation of price of imported urea at par with domestic urea would help the government in saving of around Rs750 million, reducing the subsidy impact from previous estimation of Rs22.9 billion to Rs22.22 billion. The dealer transfer price (DTP) of 50kg imported urea bag be fixed at Rs2,340/bag by National Fertilizer Marketing Limited (NFML). The press release issued by the Ministry of Finance stated that the Federal Minister for Finance and Revenue Senator Mohammad Ishaq Dar presided over the meeting of the Economic Coordination Committee (ECC) of the Cabinet on Wednesday. The Petroleum Division tabled a summary on change in take-or-pay commitment in power purchase agreements & gas supply agreements of three RLNG public sector power plants namely Quaid-e-Azam Thermal Power Plant, Balloki Power Plant and Haveli Bahadur Shah Power Plant. In the wake of prevailing international economic conditions and the unprecedented price hike of RLNG in the international market and to optimise the utilisation of RLNG for the continued operations of these power plants, the ECC considered and approved the proposal of Power Division to fix the minimum take or pay commitment at 33% under the PPA and GSA to guard the interests of both buyers and suppliers. Further, the ECC allowed the fixation of GSD under the GSA at Rs15 billion per power project.

The ECC considered another summary of the Ministry of Industries and Production on the provision of funds to the Heavy Electrical Complex (HEC) to release the markup amount to the Bank of Khyber (BoK). The ECC after discussion approved a Technical Supplementary Grant (TSG) amounting to Rs80.988 million to HEC for payment to Bank of Khyber for mark-up amount for 2nd, 3rd, and 4th quarters of the calendar year 2022. The ECC also gave approval in principle for the provision of funds with the direction that the transaction of HEC must be completed by 15th February 2023.