ECC approves Rs8.2 billion Ramazan package, Rs5,700/40kg support price for cottonseed

ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet on Tuesday approved Ramazan Relief Package worth Rs8.2 billion and allowed Rs5,700/40kg threshold intervention price for cottonseed to ensure fair price for the farmers.

Federal Minister for Finance and Revenue Shaukat Tarin presided over the meeting.

The ECC, in principle, approved the Ramazan Relief Package, 2022, presented by the Ministry of Industries and Production, involving a subsidy of Rs8.2 billion for the whole population of the country rather than only 20 million households registered with the Ehsaas Rashan Riayat Programme with the directives to frame procedural mechanism for limiting the interventions by each family.

The Ministry of National Food Security and Research submitted a summary regarding intervention price for cotton 2022/23 crop. To revive cotton production in the country, bring stability in the domestic market and assure fair return to the farmers, the ECC allowed Rs5,700/40kg threshold intervention price for cottonseed.

The meeting also allowed to initially procure two million bales of cotton at the intervention price with directive that the quantity would be reviewed on a monthly basis.

The Ministry of Economic Affairs submitted a summary on G20 Debt Service Suspension Initiative (DSSI).

The ECC allowed the ministry to sign 15 debt rescheduling agreements with various credit countries, finalised under the Debt Service Suspension Initiative.

It also approved the proposal of the Petroleum Division regarding the issuance of sovereign guarantee, amounting to Rs21 billion in favour of Faysal Bank Limited at a considerably lower markup rate for the remaining tenor of the loan, i.e., 4½ years along with the issuance of letter of comfort for new finance agreement of the pipeline infrastructure development project LNG-II.

On a proposal of the Petroleum Division for reallocation of the Oil and Gas Development Company’s (OGDC) Jhal Magsi gas to Sui Southern Gas Company (SSGC), the ECC allowed reallocation of 15mmcfd Jhal Magsi gas to the utility.

SSGC would carry out the project of gasification of Jhal Magsi town and would embark the required gas out of the proposed allocation. The injection of this gas will help mitigate the SSGC’s gas demand-supply deficit.

On another proposal of the Petroleum Division for the allocation of gas from Mari (deep) gas reservoir to the Sui Northern Gas Pipelines Limited (SNGPL), the ECC approved, in principle, up to 110mmcfd gas from Mari deep (Goru-B) gas reservoir allocation to SNGPL till June 30, 2024 on firm basis with the directive for the determination of price mechanism of gas.

To address the concerns of the Pakistan State Oil (PSO) and other oil marketing companies (OMCs) over the payment mechanism of price differential claims, the Petroleum Division submitted a summary on revised mechanism with the change to the previously approved mechanism that the price differential claims will be applicable on the sale of petroleum products rather than on the their procurement.

The ECC approved the proposal with the allocation of an additional Rs11.73 billion as supplementary grant to meet the expenditure on the payment of price differential claims up to March 31, 2022.

The meeting also approved the technical supplementary grant, amounting to Rs200 million to the Pakistan Military Accounts Department (PMAD) for conversion of pensioners to direct credit system.

It also gave a green signal to the technical supplementary grant of Rs3.50 billion in favour of the Higher Education Commission for the project titled “Pak University of Engineering and Emerging Technologies”.

Federal Minister for National Food Security and Research Syed Fakhar Imam, Federal Minister for Planning, Development and Special Initiatives Asad Umar, Federal Minister for Economic Affairs Omar Ayub Khan, Federal Minister for Industries and Production Makhdoom Khusro Bakhtiar, Federal Minister for Energy Hammad Azhar, Adviser to the Prime Minister on Commerce and Investment Abdul Razak Dawood, federal secretaries and senior officials participated in the meeting.