The Economic Coordination Committee (ECC) of the Cabinet here on Friday took a number of decisions including allowing purchase of 100,000 tons of sugar from the domestic producers.
The ECC, met here under the chairmanship of Federal Minister for Finance and Economic Affairs, Dr. Abdul Hafeez Shaikh also approved Natural Gas Efficiency Project, issuance of sovereign guarantee by the Ministry of Finance in terms of financing facility for the power sector and on the summary moved by the Ministry of Industry and asked the Zarai Taraqiati Bank Limited (ZTBL) to resume loaning facility to farmers with immediate effect.
The ECC also constituted a sub-committee comprising Minister for Water and Power, Minister for Petroleum and Natural Resources, Deputy Chairman Planning Commission, Secretary Finance to look into Gas Sale Purchase Agreement with Turkmenistan along with Gas Pricing formula under the Inter State Gas System Private Limited with Turkmenistan.
The ECC principally approved Low BTU Gas Pricing Policy for 2012, but made subject to concurrence of the Law Division.
The summary moved by Ministry of Petroleum and Natural Resources maintained that this policy will be instrumental in providing sufficient incentives to the investors in the field.
The ECC while formally granting approval maintained that before its execution, Law Division shall be approached by the Ministry of Petroleum and Natural Recourse so that its transparency is ensured.
The committee constituted a group comprising Adviser to Prime Minister on Agriculture, Kamal Majibullah and Chairman FBR to look into procedure for the gradual increase of levy of 5% to 16% on sales tax on agricultural tractors, in three years.
It may be added that this subject was elaborately discussed in the ECC meeting held on December 2011, which had constituted a committee comprising Special Adviser to PM on Agriculture, Secretary Finance, Secretary Industries, Chairman FBR which was subsequently revised by the Cabinet and met under the chairmanship of Minister of Kashmir Affairs, Senior Minister for Industries, Special Adviser to PM on Agriculture and representatives from ZTBL, Pakistan Association of Automotive Parts and Manufacturers and Tractor Manufacturers which discussed the impact on revenue on government exchequer after the imposition of the sales tax at 5% .
The said committee had unanimously agreed to reccommend sales tax on manufacturing of agricultural tractors be reduced from 16% to 5% and gradually enhance on yearly basis to the stand and rate of Sales Tax and ask Zarai Taraqiati Bank Limited (ZTBL) to resume loaning facility to farmers with immediate effect.
While reviewing the sugar situation in the country, the Chairman of ECC Dr. Abdul Hafeez Sheikh directed the Chairman TCP to make the payment to all the millers expediently and make sure to avoid any lapse in it, since the payments ultimately goes to the farmers.
The Chairman TCP informed the ECC that eight millers have been paid, and rest of the millers shall be positively paid by the end of this month.
The ECC, before discussing the agenda items, was given a detailed resume of the current economic situation in the country particularly on Consumer Price Index (CPI), Sensitive Price Index (SPI), coming cotton and, rice crop, increase in exports, foreign exchange reserves, and borrowing from the State Bank, by the Secretary Finance.
The ECC paid tribute to the outstanding services of Salman Siddique as Chairman FBR, who shall stand retired this month.
The Chairman of the Committee said that he made historic records in the collection of revenue as the Chairman of the FBR which will be taken as precedent for the other officers in the Revenue and Finance Division.