ECC okays textile package: Support prices for pulses, rice fixed
By Our Reporter
ISLAMABAD, July 15: The government has accorded approval to the textile package and fixed intervention prices for pulses and Basmati rice for the fiscal year 2006-07.
The decisions were taken in a meeting of the Economic Coordination Committee (ECC) of the cabinet presided over by Prime Minister Shaukat Aziz here on Saturday.The prime minister informed the meeting that a Qatari company would make an investment of $2 billion, especially in cement and infrastructure.
Adviser to the finance ministry Dr Ashfaq Hasan Khan, accompanied by Textile Industry Minister Mushtaq Ali Cheema, stated this in a press briefing after the ECC meeting.
Mushtaq Cheema said the ECC had decided that a six per cent research and development (R&D) subsidy would continue for readymade garments and knitwear exports for the fiscal year 2006-07. It will be reduced to three per cent for the fiscal year 2007-08 for the same products.
Mr Cheema said in addition to this support, it was also decided to give a three per cent subsidy on export of dyed/printed fabrics and white textiles. The rate of subsidy would be five per cent on export of dyed/printed home textiles.
This entire subsidy was estimated to result in a net loss of Rs11.834 billion to the national kitty during 2006-07. However, the expected growth in export of these commodities because subsidies has been estimated at Rs22-25 million during the year under review.
The minister said the revised finance schemes would help in expansion as well as resolving capital problems of the textile manufacturers. In reply to a question, the minister said the State Bank would finalise the package for refinance scheme shortly.
Dr Ashfaq Hasan Khan said the intervention prices for pulses and Basmati rice had been fixed for the fiscal year 2006-07. The intervention price for gram pulse was fixed at Rs750 per 40kg, moong pulse at Rs1,200 per 40kg and mash pulse at Rs1,300 per 40kg.
He said in case of any decline in prices of these pulses, Passco would intervene to stabilise prices in the market.
Mr Khan said the food and agriculture ministry had also proposed an intervention price for rice, which was not approved by the ECC because of deficit information. “This summary will now be approved in the cabinet meeting on Monday.”
Under the proposal, it was proposed to increase the intervention price for super Basmati and Basmati 2000 to Rs625.45 per 40kg from the current Rs560 per 40kg, an increase of 12 per cent; Basmati 385 to Rs520.45 per 40kg from Rs460, an increase of 13 per cent; and Irri-6 to Rs303.41 per 40kg from Rs260, an increase of 17 per cent.The adviser made it clear that these prices would be finalised in case similar increase was recorded in the international market otherwise it would affect Pakistan's exports.
He said the ECC had decided that the income tax exemption regarding the funds collected for Wapda First Sukkur Company for raising Rs8 billion for the Mangla dam raising project would be decided by the chairmen of Central Board of Revenue and Wapda. He said the ECC had also announced the establishment of Khuzdar power plant.Mr Khan said the ECC had approved the passing of German soft loan of 4.5 million euro as grant to the Northern Areas administration and 3 million euro as grant to non-governmental organisations.
