The Economic Co-ordination Committee (ECC) of the Cabinet on Tuesday approved up to 40 years’ tax exemption to Gwadar Port on Dubai-backed proposal, but shelved decision on wheat support price. The ECC on Tuesday held its last meeting, totalling 115 meetings under the chairmanship of Shaukat Aziz as Finance Minister and Prime Minister.
It also posed for a photo session. After the meeting, Dr Ashfaque Hasan Khan, Special Secretary, Finance, briefing the journalists, said that the ECC granted 20 years corporate income tax exemption. He said that three companies, to be formed by Gwadar Port, would be exempted from sales tax, while material and equipment to be used for construction of Gwadar Port would also enjoy sales tax exemption for 40 years.
An official, however, told Business Recorder that Gwadar Port proposal was not on the agenda till previous night and it was brought up at the eleventh hour as it was being pushed by the Dubai-based investor. When he was asked if this tax exemption was not being given to Aqeel Karim Daddy, he preferred to remain silent.
The ECC also decided to shelve wheat support price, proposed by the Ministry of Food, Agriculture and Livestock (Minfal) and the committee under Minister for Industries and Production Jahangir Khan Tareen.
Minfal was of the view that wheat support price should be Rs 500 per 40 kg while the Tareen committee had revised it to Rs 450 per 40 kg. “The ECC has decided to delink support price and procurement price, signalling to the farmers that the government was targeting 7 million tons wheat procurement–two million tons more than last year,” Dr Ashfaque said. He said that the issue was discussed in detail and it was decided that support price would be determined at the time of procurement.
He said that the ECC also approved motorcycle development program, according to which $50 per motorcycle would be provided as Research and Development (R&D) support on export. However, the government would review the policy annually to ensure that it is not misused.
At present, 43 companies are manufacturing motorcycles. Of this number, Honda, Yamaha and Suzuki have been here for long, but 40 companies are new, which are owned by Chinese investors.
The ECC also approved the long-awaited auto sector development program without any financial implications, he said, adding that used vehicles import would be regulated so that local industry may not feel the brunt. He said that ECC approved co-generation of power by the sugar industry on fast track basis, but did not approve the tariff recommended by Industries Minister.
The industry has indicated to generate 1500-2000 MW electricity, using coal (local or import) and bagasse which could also be expanded. He said that the National Electric Power Regulatory Authority (Nepra) had been directed to determine upfront within 45 days of filling the application.
“PSMA will provide all necessary information to the regulator for upfront tariff,” he added. He said that at present 3.347 million tons wheat is in stock available in the country. Of this, Punjab has 2 million tons, Sindh 350,000 tons, NWFP 72,881 tons, Balochistan 48,270 tons and Passco 863,969 tons.
The ECC also reviewed the prices of essential commodities and noted that there was an increase in the prices of 24 items, decrease in four, and prices of 25 items remained stable during the week ending November 8.
He said revenue collections during October was Rs 66 billion against the target of Rs 61.8 billion, showing an increase of 23.7 percent. The revenue collection during the first four months of fiscal year was Rs 271.1 billion, showing an increase of 14.3 percent as compared to the corresponding period of last year.
Dr Ashfaque said total exports during July-October this year were worth $5.865 billion, registering an increase of 6.3 percent over the last year, while imports were of $11.4 billion, showing an increase of 19.7 percent as compared to the corresponding period last year. The increase in imports was mainly due to rise in oil bill and machinery.
Sorce: Daily Times