ECC approves Rs1.733bln Ramzan Relief Package to subsidise 19 commodities

ISLAMABAD: The Economic Coordination Committee (ECC) of the federal cabinet on Thursday approved Ramazan Relief Package 2018, with subsidies worth Rs1.733 billion on 19 commodities to provide relief to the general public during the upcoming holy month.

The meeting of the ECC was chaired by Prime Minister Shahid Khaqan Abbasi.

“The ECC approved the Ramazan Relief Package – 2018 for 19 daily use items provided by the Utility Stores Corporation,” a statement said. These subsidised commodities include flour, sugar, cooking oil and ghee, grams, basen, dates, rice, squashes, milk and tea. Last year, the government subsidiesed 19 commodities worth Rs1.6 billion. The statement said the PM Abbais directed authorities to provide daily use items under the Ramazan package at lower rates than the market.

Meanwhile, the ECC also approved extension in financial closing date of 660 KV high-voltage direct current (HVDC) Matiari-Lahore Transmission Line by seven months

The $2 billion project got a deadline extension till December 1, 2018 for its financial close, without doubling the amount of performance guarantee.

“The decision has been taken to align the project with the completion of upcoming coal fired power projects being developed at Thar and near Karachi as well as 1,100 MW K-2 project at Karachi,” the statement said.

The 878km Lahore-Matiari transmission line is part of the China-Pakistan Economic Corridor and is the country’s first project based on direct current. The line will have capacity of transmitting about 4,000MW of electricity.

The ECC also approved a proposal of the power division for raising of Rs100 billion through commercial banks as “a fresh financing facility to be arranged through Power Holding Private Ltd. (PHPL)”.

“The loan amount will be utilized for funding the liabilities of the power distribution companies towards Central Power Purchasing Agency (CPPA) and the sectoral entities,” the statement said.

The PM Abbasi, earlier this week issued directives to the finance ministry to release Rs100 billion to reduce circular debt.

The circular debt in the power sector has swelled to Rs977 billion. The current payables stand at Rs542.9 billion and the loans borrowed by the power sector parked in PHPL at Rs434 billion.

During the current fiscal year government has released only Rs73 billion under the circular debt.

The ECC also allowed Pakistan Agriculture Storage and Services Corporation (PASSCO) to export 500,000 tons of surplus wheat at a rebate of $ 155/ton through sea route.

The country has been hardly visible in wheat export markets in past years, with its main sales going to Afghanistan. But a bumper crop last year and large stocks led the government to introduce an export subsidy scheme in January which has sparked a series of large export sales in January and February.

The ECC, in December approved a programme to export 2 million tons of wheat in the current financial year, with 1.5 million tons coming from Punjab and 500,000 tons from Sindh.

The half a million tons additional wheat allowed to export would take the total shipments to 2.5 million tons this year.