Govt allows import of staple cotton from India

Caretaker finance minister Dr Salman Shah did not attend the meeting. The sources said the ECC directed deputy chairman planning commission Dr Akram Sheikh to ensure that cotton import did not exceed the allowed limit that may crash domestic cotton prices to the disadvantage of local farmers.

It was for the first time in more than eight years now that almost all the leading newspapers were denied a briefing of the ECC meeting despite repeated requests. The briefing by economic adviser to the finance ministry Dr Ashfaque Hassan was kept restricted to official media and cameramen of the electronic media.

The sources said the ECC also gave a post-facto approval to a Rs18 billion syndicated loan through Habib Bank Limited (HBL) for payment to Pakistan State Oil (Rs12 billion) and Shell Pakistan (Rs6 billion) at an interest rate of 10 per cent. The government will repay Rs22 billion next year to the banking consortium in one go that would include both the interest as well as the principal amount, the sources said.

The loan has been arranged to improve cash flow problems being faced by the oil companies that has led to lowest ever oil stocks in Pakistan's history. The cash flow problems arise due to a freeze on oil pricing.

The meeting, said these sources, was informed that Sindh government has provided a full month wheat quota to the flour mills instead of weekly quota to overcome flour shortage in the provinces. As a result, the government claimed that wheat price has declined from Rs19 to Rs17 per kg.

Likewise, the meeting was also informed that with the imposition of regulatory duty on wheat products a few days ago, the exports to Afghanistan had came to a negligible level.

The ECC also endorsed delinking of LPG prices with Saudi Aramco Contract price allowed by the caretaker prime minister early this month. These sources said an upfront tariff for coal based power projects proposed by a secretaries committee was rejected by the ECC when it was found that normal procedure for tariff setting

was being run over by some interested parties. They said the caretaker prime minister also listened to the disagreeing views of the National Electric Power Regulatory Authority (Nepra) and asked it to come up with a new mechanism in consultation with all stakeholders and after ensuring proper examination of related data.