Duty on re-rollable scrap reduced to 10 percent: Cabinet raises phutti support price to Rs 925; WT at import stage on steel products to continue

The Cabinet on Wednesday decided to reduce the rate of customs duty on import of re-rollable scrap from 25 percent to 10 percent with immediate effect. The previous rate of 25 percent was being agitated against by local industries on the ground that it was very high as compared to the duty rate on other raw materials like M S scrap, ships for scrapping and billets.
It is believed that with this reduction in custom duty, the local construction industry would benefit by way of substantial decrease in prices of steel products, said an official handout giving details of Cabinet decisions.
The Cabinet also discussed a proposal to eliminate the current levy of 3 percent withholding tax on import of ships for scrapping and 6 percent withholding tax on import of other raw materials and intermediary products.
It further decided not to charge any withholding tax on import of raw materials by Pakistan Steel and other industrial manufacturers against exemption certificate to facilitate its import without withholding tax. However, the Cabinet deferred the decision on the above proposal relating to WT on the import stage.
The Cabinet reviewed the situation arising from the recent sharp increase in steel prices, both in the international and domestic markets.
Prime Minister Zafarullah Khan Jamali directed the Minister of Industries and Production and the Ministry of Finance to closely monitor the situation to ensure availability of both cement and steel as the demand for these had increased sharply in the recent months on account of a healthy upturn in the construction and housing sectors.
The Cabinet also approved the support price of seed-cotton (Phutti) at Rs 925 per 40 kg from the current level of Rs 850.
The increase has been approved in the background of enhanced cost of production due to increase in cost of fertilisers, both DAP and urea, and the price of diesel.
Trading Corporation of Pakistan will be assigned the task of implementing the price policy of seed-cotton through buying lint at price to be based on the new support price of seed-cotton.
Referring to the critical role of cotton in the national economy, the Prime Minister directed the Minister for Food and Agriculture to activate the agricultural research organisations to ensure improvement in quality of seed, continuous testing of soil and provision of quality fertiliser at affordable prices.
The Prime Minister also took serious notice of reports of adulteration in pesticides and directed the Ministry to co-ordinate with the Provincial governments to eliminate this malpractice.
He directed that the adulterers of pesticides must be awarded exemplary punishment under the law.
The Prime Minister entrusted Dr Atta-ur-Rehman with the task of bringing about improvement in the quality of seed through intensive research. Expressing displeasure over the performance of Pakistan Agriculture Research Council and National Agricultural Research Centre, the Prime Minister directed the Minister for Food and Agriculture to ensure that these two organisations move out to the fields to relate their research with the actual needs of the farmers.
The Cabinet approved a proposal to stop issuance 5-rupee bank notes from July 1 this year whereas the notes already issued will continue to remain in circulation.
The commercial banks will stop issuance of reissuable notes with effect January 31, 2005, but will continue to accept 5-rupee notes up to June 30, 2005.
The 5-rupee notes will continue to remain legal tender up to June 30, 2005. A decision to replace 5-rupee bank note with 5-rupee coin was taken by the Cabinet some three years ago.
The Pakistan Mint has committed to provide 250 million pieces of 5-rupee coins by the end of the current financial year.
The Cabinet also reviewed the position of wheat and 'atta' in the country and noted with satisfaction that this essential item was easily available in the market and that the prices, which had gone up, especially in Sindh, had now registered a decline. With the wheat harvest now underway in Sindh and expected to start in Punjab and other areas next month, the wheat stock position and supply of 'atta' would be further enhanced bringing about further stability in its prices.
The Cabinet was informed that the wheat production target of 20 million tons for this year was expected to be achieved.
The Prime Minister observed that storage of wheat in the provinces leaves much to be desired. He specially referred to the need to clear the old stock before storing the newly procured wheat in the same godowns.
The Cabinet considered the recommendations of the committee which had been constituted to examine the issue of Pakistan Sikh Gurudwara Prabandhak committee and agreed with the recommendation to establish Pakistan Sikh Gurudwara Prabandhak committee comprising exclusively of representatives of the Pakistani Sikhs.
Commenting on the proposal, the Prime Minister reiterated the resolve of his government to ensure the rights and privileges of the religious minorities in Pakistan.
The upkeep, maintenance and improvement of the Sikh holy places in Pakistan, he said, was the responsibility of the Government of Pakistan, which would spare no effort to live up to that responsibility.
The Prime Minister directed the Ministry of Culture and Minorities Affairs to take all necessary steps to improve and upgrade the facilities for the Sikh pilgrims at these holy places.
Earlier, the Prime Minister welcomed the two new Ministers to the Cabinet and expressed confidence that they would contribute fruitfully to the proceedings of the Cabinet and the working of the government.
He said that he took satisfaction in the democratic environment in which his government was functioning and said he and no doubt members of his cabinet would continue to discharge their responsibilities with the same dedication and transparency that has been the hallmark of his government during the past year and a half.