The Economic Coordination Committee (ECC) of the Cabinet on Wednesday approved a package of Rs50 billion for agriculture sector but deferred the Ministry of Petroleum's proposal on oil hedging without having any discussion.
An official said that no discussion was held on the hedging of oil because Petroleum Division withdrew its proposal soon after it was taken up for discussion.
The Pakistan State Oil has reportedly opposed the proposal on hedging and conveyed to the Petroleum Division that it was not possible to become a counter-party due to financial constraints.
The ECC meeting presided over by Adviser to Prime Minister on Finance Dr Abdul Hafeez Shaikh was submitted Rs56.6 billion agriculture package but the ECC approved Rs50 billion and directed the Ministry of National Food Security and Research to rationalize the package in accordance with Rs100 billion announced in the Prime Minister's corona pandemic relief package on equal basis for Small and Medium Enterprises (SMEs) and the agriculture sector.
The SMEs have already been disbursed Rs50 billion to provide indirect cash flow support to nearly 3.5 million people through pre-paid electricity.
Under the agriculture package, there is a subsidy of Rs37 billion to farmers on fertilizers in the form of Rs925 per bag on the DAP, and Rs243 per bag on urea. Moreover, a Rs8.8 billion subsidy is for mark-up on loans while a Rs2.3 billion subsidy on cotton seeds.
The meeting was informed that the estimated urea off take would be around 3.04 million tons, while the DAP was estimated at 0.95 million tons for the Kharif season.
The package would be implemented by the provinces with disbursement of amount through scratch card scheme already being implemented by Punjab.
The ECC was told that the fertilizer share in cost of production for major crops was around 10 to 15 percent, and the provision of subsidy would reduce the cost of production for farmers, and increase their affordability to adopt the recommended level of fertilizer nutrient use and best agricultural management practices.
The meeting was informed that the package would also include a subsidy of Rs2.5 billion on sales tax on locally-manufactured tractors for a period of one year.
The ECC empathized inclusion of other banks along with the ZTBL in the scheme to enhance outreach of farmers with a land holding of 12.5 acres.
As markup had been reduced by the State Bank of Pakistan, the interest rates used in the proposal could also be rationalized accordingly, it was suggested, the meeting noted.
The ECC wanted that a mechanism of scratch card system should be monitored carefully to ensure that the actual beneficiaries of package were genuine farmers and package was not misused.
The ECC also approved Poverty Alleviation and Social Safety Division proposal for disbursement of the Special Relief Package for the population living along the Line of Control (LoC) in a single installment of Rs12,000 for six months from January 1 to June 30, 2020, while from July onwards, LoC families would be disbursed monthly installments of Rs2,000 each till December 31, 2020.
The ECC also took up different proposals for technical supplementary grants by various divisions and approved one proposal by the Defence Division for technical supplementary grant of Rs 16.6 billion to meet the expenses on POL, utilities and medical stores maintained by the Defence Services and another proposal by the Finance Division for a technical supplementary grant of Rs 288 million for payment of salaries to the employees of Pakistan Machine Tool Factory for the period from October 2019 to June 2020. The ECC also approved a proposal by the Ministry of Law and Justice for technical supplementary grant of Rs 40 million for the employees related and operating expenditures of the Federal Judicial Academy.
The ECC also considered Ministry of Industries and Production's proposal regarding the human resource rationalization of workforce of Pakistan Steel Mills at a cost of Rs18.74 billion to be paid for retirements and termination dues of over 8,000 of 9,000 PSM employees, and directed the ministry to re-work the scheme in consultation with the PSM management to extend its scope to a maximum number of PSM employees and bring it back to the ECC.
The ECC also approved, in principle, Mobile Device Manufacturing Policy after a detailed briefing on various aspects of the policy. It directed the Ministry of Industries and Production to further fine-tune its various features and incentives for promoting localization and research and development leading to export of mobile phones.
A proposal by the Ministry of National Food Security and Research for the release of 35,000 metric tons of wheat from the PASSCO to the Azad Jammu and Kashmir government at Rs1.52 billion cost, including the cost of wheat and incidental charges, to be paid 50 percent by the federal government from the stimulus package announced to fight against Covid-19 was also approved.
Comments
Comments are closed.