The Economic Coordination Committee (ECC) approved the Mobile Device Manufacturing and Electric Vehicles Policy (02-03 wheelers and Heavy Commercial Vehicles) presented by the Ministry of Industries and Production.
After due deliberation, the forum approved the removal of a withholding tax of 4 percent on manufacturing to retailers of locally manufactured phones to incentivize the sector.
Moreover, the removal of the Sales Tax on locally manufactured phones was also approved and modalities will be worked out in consultation with the Finance Division.
ECC approved the following technical supplementary grants:
- Rs. 219.3 million for the operationalization of the newly established Isolation Hospital and Infections Treatment Centre, Islamabad.
- Rs. 305.462 million to pay off Pakistan’s annual contribution to the World Health Organization (WHO).
- Rs. 106.775 million to the ICT Administration for various projects
- Rs. 706.82 million for FATA, temporarily displaced persons, Emergency Recovery Project, NADRA.
- Rs. 278.091 million for Annual Contribution of Pakistan to UNFA, PPD & IPPF-FPAP for FY-2018-19, 2019-20 & 2020-21.
- Rs. 53.10 million for procurement of medical equipment, machinery, and medicines to combat COVID-19.
The Finance Secretary briefed the forum about the rationalization of subsidies (phase-I). A detailed presentation was given by SAPM on Revenue focusing on Electricity, Food, and National Savings during the first phase.
The Chair appreciated the detailed plan for rationalization of subsidies, its various components and directed to present a comprehensive summary with concrete proposals suggesting a way forward before the ECC.
Priority Berthing for wheat and sugar imports was also discussed during the meeting. Minister for Maritime Affairs updated the forum about the latest position of wheat vessels and operations of Karachi Port Trust (KPT) and Port Qasim Authority (PQA) accordingly.
The Chair directed that the Logistic Committee of the ECC would be chaired by the Minister for Maritime Affairs to workout SOPs ensuring all stakeholders, including the private sector, are onboard with reference to priority berthing.
Ministry of National Food Security and Research presented a summary for the provision of additional quantities of wheat to the Government of AJ&K and Utility Stores Corporation (USC). The Chair directed to provide the first load of the additional quantities to both AJ&K and USC on priority as an interim arrangement to ensure a smooth supply of wheat across the country. The detailed proposal would be discussed in the next ECC meeting.
The ECC approved the new re-lending policy 2020 presented by Economic Affairs Division. The new re-lending policy will reflect the changes in the borrowing cost of the government, take the variation in the exchange rate into account, and pass on the actual rates to the borrower for transparency.
Other terms and stipulations, including the recovery of commitment fee as in the policy in vogue, will continue to apply.
The ECC also accorded approval for the issuance of offshore Pakistan Rupee (PKR) linked bonds to the International Finance Corporation (IFC). This will help in the availability of financing to priority sectors, promote private sector investments, and bring foreign exchange liquidity in the domestic foreign exchange market in the post-COVID-19 scenario.
The Karachi Transformation Plan was postponed to the next ECC meeting.
Minister for Interior, Sheikh Rashid Ahmed, Minister for Industries and Production, Hammad Azhar, Minister for Economic Affairs, Khusro Bakhtiar, Adviser to the Prime Minister on Commerce, Abdul Razak Dawood, Adviser to the PM on Institutional Reforms and Austerity, Ishrat Hussain, SAPM on Revenue, Dr. Waqar Masood, SAPM on Petroleum, Nadeem Babar, Federal Minister for Maritime Affairs, Ali Haider Zaidi, SAPM on Poverty Alleviation and Social Safety, Dr. Sania Nishtar, SAPM on Energy, Tabish Gauhar, Federal Minister for Privatization, Muhammad Mian Soomro, and Federal Minister for Energy, Omar Ayub Khan, participated in the meeting. Governor State Bank of Pakistan. Dr. Reza Baqir joined the meeting through a video link.