ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet on Monday approved Kissan Package with a 27 per cent increase in agriculture loan target to Rs1.8 trillion and reshaped Kamyab Jawan Programme and Kamyab Pakistan Programmes through consolidation of their similar schemes.

The meeting of the ECC presided over by Finance Minister Ishaq Dar also approved the standard legal framework for mega solar power projects, the transfer of 2,530 kanal land from the State Engineering Corporation of the Ministry of Industries to the Heavy Mechanical Complex of Special Plans Division at a nominal price and further increased the limit for the premium payable on import of high-speed diesel to avert supply chain disruption.

The ECC, however, deferred a demand of the Election Commission of Pakistan for a Rs47.417bn supplementary grant for the conduct of general elections.

On the request of the Ministry of National Food Security & Research, the ECC formally approved the enhanced Kissan Package already announced by Prime Minister Shehbaz Sharif on Oct 30. Under the package, the target for agriculture loan disbursement has been enhanced to Rs1.802tr from Rs1,419 billion, the price of DAP fertiliser is to come down to Rs11,250 per 50-kg bag from Rs13,750 and interest-free loans would be provided to convert 300,000 tube wells to solar energy. Another part of the package – fixing of electricity tariff of Rs13 per unit – was withdrawn by the Power Division.

The ECC approved the proposal of the Finance Division for revision and renaming of Prime Minister’s Kamyab Jawan-Youth Entrepreneurship Scheme (PMKJ-YES) as Prime Minister’s Youth Business & Agriculture Loan Scheme (PMYB & ALS) to make it more purposeful and beneficial for small businesses and agriculture.

Higher diesel import premiums

Ministry of Energy, Petroleum Division told the ECC meeting that ECC on Nov 4 approved an upper limit of $15 per barrel as an import premium for high-speed diesel (HSD). However, while the product was not available in the Gulf market due to its increased demand in Western and European markets, the demand for HSD had substantially increased due to the ongoing sowing season and rehabilitation efforts after the floods in the country.

As a result, there were higher risk premiums charged to Pakistani oil companies going up to $22 per barrel and expected to go up with winter demand, thus an unsustainable situation at a time the stocks in the country had depleted to less than 12 days of cover.

Therefore, to ensure premium reimbursement to importers for a smooth and sustainable supply of HSD in the country, the ECC allowed a higher premium on HSD subject to a maximum capping at $16.75 per barrel for importing OMCs other than PSO for November.

The ECC also approved a summary of the Ministry of Energy, Power Division on standardised security package agreements for large-scale solar PV projects for substitution of expensive imported fossil fuel-based power generation under the framework. The meeting, however, did not approve a condition proposed by the Power Division suggesting a special payment mechanism and quarterly indexation.

The ECC, however, authorised Boards of Alternative Energy Development Board (AEDB) and Central Power Purchasing Agency (CPPA) to approve any amendments in the IA (Implementation Agreement) and EPA (Energy Purchase Agreement), as the case may be, that are project specific and may be required to comply with Nepra’s tariff approval and/or generation licence for specific projects.

The ECC also approved a summary of the Strategic Plan Division (SPD) for the transfer of more than 316 acres of Heavy Electrical Complex (HEC) and State Engineering Corporation (SEC) land to HMC and HMC-3 at a nominal price of Rs1.395bn.

The ECC also approved a summary of the Ministry of National Health Services, Regulations for a technical supplementary grant as rupee cover for the remaining amount of the ADB Financing Agreement of $12.20 million (equivalent to Rs2.928bn) out of a $500 million ADB loan for procurement of Covid-19 vaccine and discharging liability of Covid-19 campaign during the current financial year.

Published in Dawn, November 15th, 2022