Abandonment of forex in the interbank market: ECC approves cash incentive to ECs

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ISLAMABAD: A meeting of the Cabinet’s Economic Coordination Committee (ECC) approved a tax incentive of Re1 against every US dollar to exchange companies against remitting currencies to the interbank market.

The ECC meeting chaired by Finance Minister Shaukat Tarin was subject to the proposal of the State Bank of Pakistan (SBP) to provide Re1 cash incentives against the return of every US dollar raised to from inbound remittances.

The meeting was informed that the EC is required to return 100 percent of incoming remittances to the interbank market.

The ECC approved the proposal with instructions to review the model for further improvements.

The ECC also approved the Ministry of Energy, Petroleum Division to issue a sovereign guarantee in the amount of Rs 24,188 million to M / s Habib Metropolitan Bank Ltd and a syndicate of two banks led by United Bank Limited (UBL) for the remainder of the loan and letter of comfort to the lending banks for a new financing agreement for the LNG-II pipeline infrastructure development project.

The meeting approved the Aviation Division’s proposal to roll over the principal amount of US $ 142 million, as well as the mark-up payments by the National Bank of Pakistan (NBP) for two additional years ending on the 31st. December 2024, after being informed that Roosevelt Hotel, New York was facing financial challenges.

Liquidity for the interbank market: ECs may be offered a Re1 incentive for every USD

The meeting instructed the Aviation Division to prepare a roadmap for the permanent solution of the problem.

ECC reviewed and approved Naya Pakistan Housing Development Authority’s (NAPHDA) proposal to review customer pricing and mark-up subsidy period under the government subsidy scheme for low-cost housing. and the inclusion of housing finance companies (HFCs) in the G-MSS for housing finance with the indication that there should be no direct involvement of commercial banks in NAPHDA projects.

The ECC also approved a summary submitted by the Ministry of Communication for extension of the deadline for the National Highways Authority (NHA) to prepare a commercially viable business plan until June 2022 with the same conditions regarding cash development loans (CDLs) as decided by the federal cabinet.

The limitation of the debt of the NHA would be linked to the outcome of the business plan.

The ECC also asked the Ministry of Communication to regularly submit a monthly progress report and prepare a business plan well in advance of the deadline.

The ECC also approved the proposal of the Ministry of Communication for the special allocation of additional funds of 8,000 million rupees (4,000 million rupees as initial financing of the sustainability gap (VGF) and 4,000 million rupees. rupees for overhead) against the approved GoP share for the PSDP Project “Sialkot (Sambrial) -Kharian (SKMP) Highway Project.

The ECC discussed and approved the summary presented by the Ministry of Industry and Production regarding the gas rate for the operations of the SNGPL-based factories, namely Fatima Fertilizer (Sheikhupura factory) and Agritech for the period of ‘October 2021 to January 2022, and to be maintained at Rs839 / MMBTU (with variable contribution margin @ 186 / bag).

The ECC also approved a summary submitted by the National Engineering and Scientific Commission for the issuance of the government sovereign guarantee for the NECOP project valued at USD 5,822,025 for Lot-IV and USD 26,154. 058 USD for the -V lot in favor of CETC, Beijing, China to repay the loan in seven years, including a two-year grace period.

The ECC examined and approved the summary submitted by the Ministry of Maritime Affairs for the granting of flexibility to the 19 PNSC subsidiaries of the applicability of Public Sector Companies (Corporate Governance Rules).

Purchase of forex by individuals: SBP sets a maximum limit of $ 100,000 per person per year

The ECC approved, in principle, the summary filed by the Ministry of Economic Affairs on the global transition of LIBOR to alternative benchmarks with guidelines that benchmarks to be adopted in the future may be submitted to the ECC. ECC for approval.

The ECC discussed in detail the summary presented by the Ministry of Industry and Production for the revision of the prices of non-subsidized goods and the maintenance of untargeted subsidies after December 31, 2021.

After deliberation, the ECC authorized the Ministry of Industry and Production to maintain the subsidy on the five commodities for only one month in January 2022.

The ECC approved an additional technical grant worth Rs 90 million for the 1.2 MGD reverse osmosis (ROD) desalination plant in Gwadar (Chinese grant), TSG of R 14.621 million for the ‘purchase of spare parts for helicopter maintained by Pakistan Rangers, Sindh as well as TSG for the release of funds Rs431.880 million to the project implementation letter of Frontier Corps (South) KP HQ, Dera Ismail Khan financed by the Bureau of International Narcotics and Law Enforcement – ​​Pakistan (INL-P), and Rs751.486 million in favor of the Ministry of Energy, Electricity Division, on the development expenditure of the Ministry of Planning, Development and Special initiatives.

On a summary of the provision of funds for life-saving medicines to the Afghan people, presented by the Ministry of National Health Services, Regulation and Coordination, the committee advised the Ministry of National Health Services, on regulatory and coordination to review its budget and request that it be satisfied by reallocation of funds in the budget.

Commercial copyright recorder, 2022

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