Lahore's Orange Line project granted huge concession by ECC

The Economic Co-ordination Committee (ECC) of the Cabinet has granted withholding tax exemption to Chinese Contractor CR-Norinco JV and allowed duty and taxes free import of equipment/apparatus for the Lahore Orange Line Metro Train Project.
During the meeting of the ECC, chaired by Finance Minister Ishaq Dar on Friday, a proposal was put up by Ministry of Planning, Development and Reforms with request of the government of Punjab to grant exemption in withholding tax as well as tax and duties on import of equipment for Orange Line project. Sources said that Punjab government has estimated that roughly Rs 20 billion taxes and duties on import of Lahore Orange Lime Mass project would cost.
The ECC has granted exemptions from withholding tax beyond 6% of E&M contract price to the said Chinese contractor. The ECC approved the proposal and also decided that a similar dispensation would also be extended to the other rail-based mass transit projects in Karachi, Peshawar and Quetta at appropriate time. The ECC was informed that Lahore Orange Line Metro Train Project has been made a part of the China-Pakistan Economic Corridor (CPEC) along with rail-based mass transit projects in other provincial capitals at the recently concluded 6th Joint Co-operation Committee (JCC) meeting held in Beijing, China.
Sources said that proposal of Ministry of Industries for reduction in price of imported urea available with National Fertilizer Marketing Limited to Rs 1,000 per 50-kg bag from Rs 1,200 per 50-kg was not taken up. They added the ECC had previously reduced the price of urea to Rs 1,310 per 50-kg bag followed by Rs 1,200 per bag in September 2016 and now a request was forwarded to further reduce the price to Rs 1,000 per bag.
However, sale of urea was 13,000 metric tons till mid-December 2016 while the NFML was required to dispose of 263,000 tons in the first three months of 2017 calendar year against the estimated balance of over 1.1 million tons. An official said the government may consider allowing export of urea as well. Sources said that the proposal in this regard was not even tabled to the ECC for some reasons.