ISLAMABAD: The Economic Coordination Committee of Cabinet (ECC) here on Tuesday approved in principle the sale of wheat to Iran under barter trade system and asked Governor State Bank to get Ministry of Foreign Affairs view point in context of international trade restrictions faced by Iran.

The ECC met here under the chairmanship of Federal Minister for Finance and Economic Affairs, Dr. Abdul Hafeez Shaikh which discussed various agenda of national importance, says a statement of the Ministry of Finance issued here today.

The meeting was started with ECC member’s acknowledgement to Dr. Farooq H. Naik, Federal Minister for Law and Justice for his great achievements in his professional and political career.

While arguing on the increasing food needs of growing population and gas suspension to SNGPL and SSGPL based Urea Plant, Ministry of Industries proposed for Import of 0.6 million tons urea to be utilized in Rabi 2011-13 with price reduction of Rs.1600 to Rs.1450 per 50kg bag.

After due deliberation, ECC approved to import 0.3 million Urea and decided not to change existing pricing formula.

The ECC also approved in principle the removal of High Octane Blending Component (HOBC) from inland freight equalization margin (IFEM) regime, subject to consultation and endorsement from Ministry of Law & Justice.

After removal of IFEM for HOBC the ex-depot prize of HOBC will vary from location to location across the country contrary to other oil products.

The ECC also approved the short and long term liquefied natural gas (LNG) import framework proposed by Ministry of Petroleum & Natural Resources.

However, ECC formed a technical group comprising Secretary Petroleum, Secretary Finance, Secretary Water & Power, Deputy Chairman Planning Commission, Chairman Board of Investment and Chairman State Bank of Pakistan to work further on mechanism, bidding details, guarantee matters and legal issues as raised by Minister of Law and to present a report to ECC a next meeting.

The ECC also approved import of Furnace Oil by Pakistan State Oil (PSO) under term contract.

However, ECC asked Ministry of Petroleum & Natural Resources to work for detailed calculations on the subject with consultation of Ministry of Finance.

The ECC also discussed a summary moved by Ministry of Petroleum & Natural Resources regarding adjustment of Petroleum products prices on weekly basis.

After evaluating different aspects of proposal, ECC allowed to adjust petroleum products prices weekly on a trial basis in order to examine impact on general public and oil marketing companies.

The matter of terms of settlement with IPPs regarding delays in payments by power purchaser under power policy 2002 was also discussed in the meeting.

The ECC approved the payment scheduled of the amount of Rs.24 billion which is overdue and payable more than 45 days, as proposed by Ministry of Water & Power.

The ECC also constituted a committee comprising Secretary Petroleum & Natural Resources, Secretary Finance and Deputy Chairman Planning Commission to work further on the other matters of the said proposal.

While arguing the need of energy in the country, Ministry of Water & Power proposed a summary for issuance of GOP guarantee in the sum of Rs 10 billion to be raised in the form of loan from the banks/institutions by WAPDA for water sector projects and the repayment of loan alongwith interest shall be made through PSDP as concurred by the Finance Division. ECC approved inprincipal the said summary, however, the retiring of loan will be decided by a committee headed by DCPC, including Secretary Finance and Chairman WAPDA.

The ECC also approved summaries regarding “donation of wheat to the food-poor and malnourished people of Pakistan through the World Food Programme on cost sharing basis” and declaration of Biaxially Oriented Polyethylene Terephthalate (BOPET) Film Projects of M/S Novatex and M/S Astro Plastic (PVT) Limited as “Pioneer Industry”.

The ECC also allowed 30000 tons of sugar export to Tajikistan on Government to Government basis at prize differential of $ 20 per ton from International Market.

The summary on “reduction in capacity payments to IPPS during February-May 2011 owing to Gas Supply curtailment by SNGPL” was also discussed in the meeting.

The ECC approved the recommendation given by Ministry of Water & Power that the issue of determination and payment of lost capacity incurred by the IPPs by resolved through “Joint Expert Mediation” between the Gas Supplier, Power Purchaser and IPPs (Guidelines for Joint Expert Mediation).