ISLAMABAD: The Trading Corporation of Pakistan (TCP) is paying Rs 143 million mark-up daily on loans raised from banks for import of wheat, sugar and fertilizer due to nonpayment by Utility Stores Corporation (USC), National Fertilizer Marketing Limited (NFML) and Passco.
“We are paying Rs 48.5 million mark-up on a daily basis on outstanding receivables of Rs 73.7 billion against USC, Rs 63.84 million against outstanding receivables Rs 97 billion of NFML and Rs 30 million on receivables of Rs 46 billion against Passco,” said TCP Chairman Rafeo Bashir Shah in his presentation to a National Assembly panel.
The panel comprising Rana Iradat Sharif (Convener), Tahira Aurangzeb and Syed Javed Ali Shah heard the viewpoints of Ministry of Commerce, TCP, Ministry of Industries and Production, USC and NFML.
The TCP stated that for the year 2007-08, principal amount has been paid, but due to delayed payment mark-up has been accruing which is also payable by USC.
During a meeting held on December 08, 2021, in the presence of Secretary MOI&P and Finance Division, USC agreed to the amount payable by them. However, USC expressed inability to pay due to unavailability of funds.
Chairman TCP informed the panel that outstanding receivables are related to 2008-13. He said a new settlement mechanism has been signed amongst the entities from 2018 onwards and there is no dispute on the amount and mark up.
Replying to a question by the panel, Additional Secretary Finance Division said that Finance Division cannot extend any subsidy due to financial constraints as well as being on an IMF program, however, Technical Supplementary Grant (TSG) can be considered with re-appropriation of funds already earmarked to the concerned Ministries.
The Chairman TCP and Chief Financial Officer (CFO) USC, Iftikhar Ahmed Ammer challenged each other’s claims. CFO USC, contended that USC had been forced to buy sugar from TCP, but its quality is not liked by Pakistani consumers.
Chief Financial Officers (CFOs) of USC and NFML also challenged some of the claims of TCP presented by its Chairman Rafeo Bashir Shah, especially with respect to mark up being claimed without any formal agreement, rate of bags, and accumulated mark up of short-term loans.
The CFO of USC said the USC is in deficit of Rs 15.5 billion as its claims are not cleared by the Finance Division.
Copyright Business Recorder, 2023