ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet has approved collateral-free lending of Rs60 billion to the SMEs and allowed signing of Power Purchase Agreement (PPA) – between government and KE – for supply of electricity to Karachi.
The ECC meeting chaired by Finance Minister Shaukat Tarin was presented a summary by State Bank of Pakistan (SBP) with regards to “Refinance and Credit Guarantee Scheme for Collateral Free Lending to Small and Medium Enterprises (SMEs)”.
The schemes is aimed at facilitating those SMEs, which do not have collateral to get financing from banks.
The meeting was informed that the proposed scheme would enable SBP to partner with selected banks through a transparent procedure and provide collateral free financing to SMEs to promote sustainable economic growth and development in the country.
The ECC approved the summary and directed the SBP to develop a comprehensive monitoring mechanism with clear-cut benchmarks for effective performance evaluation of the scheme.
After a presentation by the Ministry of Privatisation regarding grant of National Security Certificate (NSC) and outstanding payables and recoverable issues of Karachi Electric, the ECC decided to approve the settlement of issues out of past transactions through arbitration, and directed to speed up the process for signing of a new Power Purchase Agreement (PPA) for a smooth payment mechanism and uninterrupted power supply to Karachi.
Ministers for Planning and Energy also updated the ECC about the principles agreed between the federal government and the K-Electric to resolve most of their long-standing issues regarding additional supply and payment procedures during the last meeting.
In response to a proposal of the Power Division, the ECC considered and approved allocation of 3.0 MMCFD gas from well NF Hor-1 (RE) to M/S PPL, for a period of two years, for sale to any third party selected through a competitive bidding process at a mutually agreed and negotiated price under a Gas Sale and Purchase Agreement (GSPA).
The ECC approved the summary with a direction that such summaries may be dealt with at the level of the concerned ministry/division after fulfilling all codal formalities.
On a summary of Board of Investment (BoI) regarding exemption from minimum turnover tax under Special Economic Zones Act 2012 to facilitate both SEZ developers and its enterprises, the ECC directed the Law Division, the Federal Board of Revenue (FBR), and the BoI to firm up proposals through mutual consultation regarding implementation of the exemption from minimum turnover tax and present before the next ECC for approval.
The ECC also considered a summary by Poverty Alleviation and Social Protection Division for allocation of funds for launching 2nd phase of Ehsaas Emergency Cash (EEC) programme.
The meeting was informed that the number of regular Ehsaas Kafalat beneficiaries would be increased and additional beneficiaries would be added to it (after identification through ongoing NSER) to mitigate economic hardships amid COVID-19 pandemic during the second phase.
The ECC recommended to evaluate whether the new NSER survey targets those sectors, which have been adversely affected due to smart and micro lockdowns during Covid-19, and present an updated proposal before the ECC.
The underlying rationale is to provide targeted subsidies to support the most vulnerable segments of society during the third wave of the pandemic, the meeting noted.
The ECC also considered and approved a summary presented by the Ministry of Commerce about condonation of delay of late shipment of vehicles imported by overseas Pakistanis subject to compliance with all other conditions of import.
The ECC approved Technical Supplementary Grants; (i) Rs100 million for the Ministry of Defence Production for Project Management Cell for Gwadar Shipyard; (2) Rs3 billion in favour of Government of Gilgit-Baltistan to meet the employee-related expenses;(3) Rs7.2 billion for the Ministry of Housing and Works for the execution of various development schemes; (4) Rs85 million for the Ministry of Industries and Production for meeting necessary expenditure; (5) Rs89.279 million for the Petroleum Division for the supply of gas to Allama Iqbal Industrial City (SEZ); (6) Rs1 billion for the Ministry of Climate Change for the PSDP Project titled “Ten Billion Tree Tsunami Program Phase-I”; (7) Rs317 million for the Ministry of Information Technology and Telecommunication for meeting the shortfall of funds for purchase of IT equipment by NITB; (8) Rs4.8 million for the Ministry of Housing and Works for the repair and maintenance of Abandoned Property House, Islamabad; (9) Rs96.418 million for the Ministry of Housing and Works for meeting necessary expenses;(10) Rs45 million for the Ministry of Housing and Works for National Housing Authority (NEW; Policy and Planning Wing); and (11) Rs7.5 billion for the Ministry of Railways for payment of pay and pensions dues of employees.
Copyright Business Recorder, 2021