MoI&P asked to settle impasse with provinces: Selling ‘un-needed’ imported urea becomes new headache for govt

ISLAMABAD: The federal cabinet has directed the Ministry of Industries and Production (MoI&P) to settle impasse with provinces on payment of subsidy on imported urea and find out viable mechanism to sell “unneeded” imported urea, well-informed sources told Business Recorder.

During discussion on sundry issues, the Cabinet in its previous meeting was apprised that billions of rupees in government revenues were due for recovery, but could not be recovered because of longstanding subjudice cases in at least 20 different tribunals.

It was further informed that the Law Division had taken up the issue with the relevant tribunals where cases for tax collection were pending, in response to which the tribunals would be sharing the details of the pending cases and also develop services like digitisation along with dashboards to be monitored weekly. The cabinet was also apprised of the reform initiatives taken by the FBR to control pilferages, expand the tax base, digitise, and restructure the FBR.

Imported urea fertiliser: Hike in basket price approved by ECC

The cabinet was also apprised of matters relating to the second review of the IMF and the ongoing discussions with the Fund. The cabinet was informed that Pakistan would participate in the spring meetings of IMF and discuss options for a larger, long-term programme with the Fund. It was added that the performance of the government had been on track as evidenced by the successful completion of the second review, and conclusion of the IMF Standby Arrangement.

The Ministry of Commerce raised the issue of non-payment of dues of urea fertiliser imported by the TCP on the requisition of the Ministry of Industries and Production. It was informed that to finance these imports, the TCP had borrowed from the banking system and interest was accruing on a daily basis because of non-payment by the NFML which had received the fertiliser but was not able to sell it. It was asserted that the fertiliser had been imported at a time when it was not required and was lying unutilised both because of low demand and its high prices as compared to local urea.

It was further informed that in the past, the four provinces shared subsidy on urea, but this time they had refused to pick the difference between the price of imported and local urea, as a result of which, much of the imported urea was lying unsold despite the introduction of a price-blending formula with local urea.

The cabinet directed that the matter be enquired into and a report be submitted to the prime minister. It was also desired to discuss this issue with provinces.

The issues of circular debt, mismanagement in Discos, and power theft and its control were also discussed in detail. The cabinet directed that the power secretary to present a precise plan for the power sector with well-defined targets and clearly specified timelines.

After a discussion on sundry issues, the cabinet directed that a report on the issue of imported fertiliser handed over to the NFML and non-payment of dues to TCP be submitted to the prime minister by the former Secretary Industries and Production Rashid Mehmood Langrial (presently Secretary power Division) at the earliest.

The cabinet further directed that the Ministry of Industries and Production should settle the impasse with provinces regarding the payment of subsidy on the imported urea fertiliser, or to find some other viable option to ensure sale of the imported urea; and to present a viable way forward for consideration of the cabinet without delay.

The cabinet directed the power secretary to present in its next meeting, a comprehensive plan on power including the issue of circular debt, mismanagement in Discos, power theft and its control as well as other issues being faced by the sector, with well-defined targets and clear timelines.

Copyright Business Recorder, 2024