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February 20, 2021

ECC approves rationalisation of subsidies on essential commodities

Business

February 20, 2021

ISLAMABAD: Economic Coordination Committee (ECC) of the cabinet on Friday approved rationalisation of subsidies on essential commodities available through Utility Stores Corporation (USC) due to increase in their prices.

The prices of edible oil at USCs would increase to Rs200/litre from Rs175/liter, according to the sources.

The ECC approved only partial rationalisation and directed officials to provide maximum relief to the consumers despite significant price differential between subsidised price offered by the USCs and the prevailing prices in the domestic markets.

The decision was taken during a meeting presided over by Minister for Finance and Revenue Hafeez Shaikh.

Ministry of industries and production presented a summary before ECC regarding revision of subsidized prices of essential commodities by the USCs. The meeting was presented various proposals to rationalize prices of wheat flour, sugar and ghee in view of continuous fluctuations in international commodity prices.

ECC also approved another summary by the ministry of industries and production for outstanding payment to Ocean Wide Shipping Services, amounting to $580,000 from Pakistan Steel Mills to fulfill a contractual obligation for transportation of coal during the year 2010.

Ministry of food security placed a summary before ECC regarding a mechanism for disbursement of subsidies in line with the fiscal package for agriculture in the backdrop of COVID-19 pandemic. The summary was approved by the ECC for timely disbursements of subsidies to the provinces subject to clearance by the Finance Division.

Ministry of information technology and telecommunication presented a summary regarding taxation issues of the telecom sector. The ECC had earlier constituted a sub-committee in October last for due deliberation. The sub-committee presented its recommendations before ECC. The committee approved these recommendations as endorsed by the Federal Board of Revenue.

The ECC considered a summary by the ministry of energy (petroleum division) regarding tax on payments to the offshore supply contractor to meet the contractual obligation. The ECC established a sub-committee with a direction to evaluate the proposal and present workable recommendations before the forum for consideration.

Ministry of Energy presented another summary about revocation of Neelum Jhelum surcharge at Re0.10 per kilowatt-hour electricity consumers. The ECC considered and approved the revocation of Neelum Jhelum surcharge (with immediate effect).

The ECC also considered and approved a summary regarding government’s sovereign guarantee for a public sector development project titled National Electronics Complex of Pakistan.

The committee further approved technical supplementary grants of Rs550 million for Special Communications Organization from ministry of information and technology during the current fiscal year, Rs200 million (out of total allocation of Rs362.2 million) to special technology zones during the current financial year and Rs109 million to ministry of information and broadcasting to clear outstanding bills related to media campaigns on behalf of Ehsaas Program during the last fiscal year.