ECC approves export of 200,000 tonne sugar 

PSM employees to get one-month salary; wheat procurement policy decided; imported POL to be tested by HDIP

ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet under chairmanship of Federal Minister for Finance Ishaq Dar on Tuesday accorded approval for exporting 200,000 tonnes of sugar, procurement of wheat for upcoming crop and one-month salary for the Pakistan Steel Mills.

In consideration of a proposal submitted by the Revenue Division, the ECC granted approval to extend applicability period of reduced rate of withholding tax i.e. 0.4%, for non-filers up to 30th June 2017.

The ECC meeting was held here on Tuesday under the chairmanship of Finance Minister, Senator Ishaq Dar in which the approval was accorded on the proposal presented by the Ministry of Commerce for further export of 0.2m tons of sugar (without any subsidy). 

The export of sugar would be made within 60 days after approval of export quota by State Bank of Pakistan or by 31st of May 2017, whichever is earlier.  It was further decided that only those mills will be allowed to export which have cleared outstanding dues of farmers relating to last season and have crushed at optimum capacity. It may be recalled that the ECC in December 2016 had allowed export of 0.225m tons of sugar till 31st March 2017 with the condition that the Inter-Ministerial Committee, constituted vide directive by Prime Minister's Office (dated 25.11.15), under chairmanship of Minister for Commerce, would recommend to ECC stoppage of further export if domestic price of sugar was negatively impacted. 

The Pakistan Sugar Mills Association (PSMA) made subsequent requests to extend the export period to 31st May 2017 and also sought an increase in export quantity. The requests were referred to the Sugar Advisory Board (SAB) for advice. The above said Inter-Ministerial committee considered requests of PSMA and inputs provided by SAB, making its own recommendations. The ECC gave approval for extending the time line and enhancing the quantity of exports in the light of these recommendations. 

The ECC also reiterated that a close watch would be maintained on the domestic sugar prices with a view to suspending exports in case of adverse impact on domestic prices.  The approval was also accorded by ECC for disbursement of one month’s (December 2016) salary amounting to Rs380 million for employees of Pakistan Steel Mills, Karachi.

After discussion on a proposal put forth by Ministry of National Food Security and Research, ECC gave approval for public sector procurement of wheat (2016-17 crop) against the target of 7.05 million tons. The financial requirements for the proposed target calculate to Rs224.86 billion. It may be mentioned that Public sector wheat stocks help augment flows during the lean period of wheat supplies as well as to fulfill the food requirements of deficient areas.

The ECC approved proposal put forth by Ministry of Petroleum & Natural Resources (P&NR) for changes in existing procedures for sampling and testing of imported petroleum products. Accordingly the product would conform to approved specifications notified by the Ministry of P&NR. The quality of the product for all importers shall be tested by Hydrocarbon Development Institute of Pakistan (HDIP) laboratory prior to unloading. Sampling of the product for quality analysis would also be carried out by HDIP in the presence of importer’s surveyors. In case of quality dispute if the sample testing by HDIP fails, re-sampling would be made by a third party surveyor in the presence of authorised representatives of concerned stakeholders including HDIP. The fresh sample, so taken, would be tested in the presence of nominated representatives of the importer and HDIP by another independent laboratory, pre-approved by the authority i.e. Ogra. Test results of fresh sample would be final and binding. Further, Ogra shall also independently carry out random sampling from vessels carrying imported petroleum products for testing through any of the laboratories approved by the authority for effective monitoring, quality assurance and greater transparency in the process.

The ECC also considered another proposal from Ministry of Petroleum and Natural Resources regarding allocation of gas from PPL’s Kandhkot field. The ECC approved that allocation of 150 MMCFD to Thermal Power Station Guddu (TPSG) [100 MMCFD directly through PPL and 50 MMCFD through SNGPL] which expired on 7thof May 2013 may be validated. Further, PPL will supply 50 MMCFD additional gas along with 150 MMCFD, directly to TPSG with effect from 1stof June 2017 or the date of commissioning of TPSG’s new pipeline whichever is earlier. The entire 200 MMCFD direct gas supply would be subject to minimum 72.5% take-or-pay quantity. Moreover, the outstanding receivables against supply of gas to TPSG would be settled forthwith subject to reconciliation.