• ECC releases Rs10bn to ECP as first instalment
• Govt to sell contract to run Islamabad airport

ISLAMABAD: Within the third week of the new fiscal year, the government opened the doors for supplementary grants on Thursday, approving Rs42.53 billion for the upcoming general election and Rs200 million for the newly created Special Investment Facilitation Council (SIFC) — a joint initiative of the government and military leadership to promote investment clusters.

Presiding over a meeting of the Economic Coordination Committee (ECC) of the cabinet, Finance Minister Ishaq Dar also allowed immediate disbursement of Rs10bn as the first instalment required by the Election Commission of Pakistan (ECP) to conduct polls. The government will release the remaining funds when needed.

In November last year, the ECP sought Rs47.42bn from the government to prepare for the general election, with a first immediate disbursement of Rs31.4bn.

However, the finance ministry did not accept this demand citing fiscal constraints and because the ruling coalition was not in favour of conducting polls ahead of schedule. The government, however, still provided Rs5bn already allocated in the previous budget for initial preparations for elections.

Early this week, the ECP again sought the remaining Rs42.53bn, reminding the government about its constitutional responsibility for taking all necessary steps to conduct polls.

With an initial estimated expense of Rs47.42bn — more than double the Rs22bn spent in 2018 — the coming polls would be the most expensive election exercise. In contrast, the polls cost Rs1.84bn in 2008, and Rs4.73bn in 2013.

These amounts do not include expenses made by the civil administration at the provincial level, including police expenses. Besides, the Rs47.4bn figure is a conservative estimate and could increase.

SIFC to get Rs200m

Informed sources said the finance ministry was initially reluctant to provide additional funds to the Prime Minister’s Secretariat for the SIFC, a forum constituted on June 2 for attracting investment from the Gulf countries in agriculture, mineral, defence, energy, and information technology.

The investment facilitation council, led by the prime minister, was formally notified on June 17, with the representation of nine federal ministers and key military officers, including the army chief.

The issue of allocation of funds for the SIFC secretariat remained under discussion at the apex level. Finally, the Ministry of Finance was directed to immediately release a Rs200m supplementary grant so that the secretariat could start working.

Cooking oil exports to Afghanistan

In Thursday’s meeting, the ECC also considered a summary of the Ministry of Commerce regarding the export of vegetable ghee and cooking oil from export processing zones to Afghanistan through land. It approved the omission of Para 7(6) and Para 7(7) of the Export Policy Order (EPO) 2022, which specifies the conditions for exports to Afghanistan.

The ECC also allowed an amendment to Schedule II of the EPO to remove the exception regarding vegetable ghee and cooking oil exports from export processing zones, manufacturing bonds and export-oriented units to Afghanistan.

Meanwhile, to revive the film industry in Pakistan, the ECC approved the proposal that cinemas may be charged electricity as per rates admissible to declared industries.

Besides, on a summary of the food ministry regarding an up to 58pc increase in cess rates of tobacco for the year 2023-24, the ECC approved revised rates as per Section 9 of the Pakistan Tobacco Board Ordinance 1968 based on the minimum indicative price for the year.

Outsourcing of airports

Meanwhile, the government is to proceed with the sale via tender of a contract to manage Islamabad airport after consultations with the International Finance Corporation (IFC), the Ministry of Finance said on Thursday.

Presiding over a steering committee meeting on outsourcing airport operations, the finance minister gave the go-ahead to the IFC, the transaction adviser, to proceed to the tender stage for outsourcing the airport to improve service delivery in line with best industry practices.

In March, the government kicked off the outsourcing of operations at three major airports. The ministry said Islamabad airport was the first to be affected, as the country seeks to generate foreign exchange reserves for the ailing economy.

Published in Dawn, July 21st, 2023