The Economic Coordination Committee (ECC) of the Cabinet has delayed its decision on the quarterly tariff adjustments for K-Electric, and has formed a committee to submit a report within a week for further review.
The ECC meeting held here on Tuesday with Adviser to the Prime Minister on Finance and Revenue Dr Abdul Hafeez Shaikh in the chair, and discussed a proposal regarding quarterly adjustments of the K-Eectric Limited for the period from July 2016 to March 2019.
In December, the National Electric Power Regulatory Authority (Nepra) had recommended the quarterly adjustment claims of the K-Electric for the period from July-September 2016 to January-March 2019 and allowed 38 percent or Rs 4.87 per unit to Rs 17.69 from Rs 12.82 per unit across the board for 11 quarters from Jul-Sep 2016 to Jan-Mar 2019 under the quarterly adjustment formula.
However, the matter was referred to the ECC.
The ECC discussed the matter, and in the light of input and discussion by the members, set up a committee including Minister for Power Omar Ayub Khan, Minister for Economic Affairs Hammad Azhar, Deputy Chairman Planning Commission, secretary Finance and a representative from the K-Electric, to examine the issue in detail and recommend to the ECC within a week a solution and roadmap for resolving the issue.
The ECC approved a technical supplementary grant of Rs 9.6 billion to incentivise a host of measures to encourage and facilitate the overseas Pakistanis to send their remittances through official banking channels.
Under the decision, following measures for the enhancement of home remittances through banking channels were approved:
i. The rebate of reimbursement of TT charges transactions between USD100 and USD200 will be increased from SAR-10/- to SAR-20/-. ii. Continuation of the new scheme of incentives launched in 2018-2019 for banks and exchange companies during the current calendar year from January 2020. As per the scheme, financial institutions would be incentivized Re0.50 per 1 USD on 5 percent growth, Re0.75 per 1USD on 10 percent growth and Re1/- per 1USD on 15 percent growth.
iii. The amount of the remittances transferred into bank accounts will be exempted from withholding tax with effect from July 1, 2020.
iv. A "National Remittance Loyalty Program" will be launched from September 1, 2020 with collaboration of major commercial banks and government agencies through which various incentives will be given to remitters through mobile apps and cards.
v. The ECC approved a technical supplementary grant of Rs 9.6 billion during the current financial year to finance the above mentioned initiatives.
Taking up other agenda items, the ECC approved a proposal by the Ministry of Federal Education and Professional Training for a technical supplementary grant of Rs 5 billion in favour of the Higher Education Commission (HEC) for the current financial year with instruction for a judicious and need-based distribution of funds among the universities.
The HEC had submitted a summary to the ECC of the cabinet, while seeking a supplementary grant of Rs 5 billion for the current fiscal year to meet public sector universities' expenses.
The HEC had demanded Rs 103.5 billion for the fiscal year 2019-2020 to meet current expenditures, but the government approved Rs 59 billion, and Rs 28 billion for the development sector against the demand of Rs 55 billion.
The government's allocation of Rs 59 billion for the current financial year to meet current expenditure was 9 per cent less than last year's budgetary allocation of Rs 65 billion and it was around 40 per cent less than demand of Rs 103 billion for the current fiscal year.
The ECC also approved a proposal by the National Security Division for a technical supplementary grant amounting to Rs 15 million for the Strategic Policy Planning Cell (SPPC) created in the National Security Division with the approval of the prime minister to act as an intellectual hub for evidence-based policy input on key national security issues.
On a proposal by the Ministry of Defence, the ECC okayed a proposal for a technical supplementary grant of Rs 34.528 million for Internal Security Duty Allowance to the Pakistan Air Force.
On a proposal by the Petroleum Division, the ECC approved allocation of gas to SSGC and Provisional Tight Gas Incentive for Rehman-4 Well in Kirthar Block subject to the finalisation and approval of requisite third-party certifications for tight gas for the same well.
The ECC also deliberated upon a proposal by the Ministry of Energy to further extend till June 2020 the grant of subsidy to agricultural tubewell consumers in Balochistan.
Earlier, the ECC was briefed that nearly 30,000 agri-consumers in Balochistan had been given subsidy since January 1, 2015 with 40 percent of the burden of subsidy borne by the Government of Pakistan and the remaining 60 percent picked up by the Balochistan government.
However, the recovery of dues from farmers for the electricity consumed over and above the limit of subsidy had been negligible and attempts to recover these dues from defaulters in the past had not been successful.
The ECC discussed the issue in detail and set up a committee, comprising among others, the Minister for Power, to discuss the issue with the Government of Balochistan to ensure a credible solution to the problems impeding a judicious execution of the scheme for which the federal government alone was contributing Rs 9 billion annually, and also allowed the extension of subsidy until a solution to the issue was found by the committee and put in place.
On a proposal by the Ministry of Industries and Production for revival of M/s Tuwairqi Steel Mills Limited (TSML) - A Direct Reduced Iron (DRI) Unit, the ECC discussed the issue and asked the Ministry of Industries and Production to resubmit the proposal in the light of recent and ongoing development on various issues among stakeholders on the proposal.
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