November 01, 2007	Thursday	Shawwal 19, 1428

ISLAMABAD, Oct 31: The government on Wednesday ‘firmly instructed’ the Trading Corporation of Pakistan (TCP) to complete the tendering process for importing 500,000 tonnes of wheat by mid-November and deferred a decision on fixing the wheat support price at Rs500 per 40kg as recommended by the ministry of agriculture.

Economic Adviser to the Ministry of Finance Dr Ashfaq Hassan Khan told newsmen after a meeting of the Economic Coordination Committee (ECC) of the cabinet presided over by Prime Minister Shaukat Aziz that so far only 100,000 tonnes of wheat had been imported or was in the pipeline.

He said the meeting also decided to write letters to the four chief ministers to take action against wheat hoarders.

Dr Khan did not say who would be held responsible for allowing 500,000 tonnes of wheat export at about $210 per tonne and then allowing equivalent quantities of wheat imports at more than double the rate and what was the total cost to the national exchequer because the ECC did not discuss the issue.

He said the ministry of food and agriculture had come up with a summary for increasing wheat support price for the current season to Rs500 per 40kg from last year’s Rs425 but “no decision was taken and the summary was deferred”. He said Minister for Industries and Production Jehangir Khan Tarin was asked to look into the issue and come up with ‘some innovative ideas’ in two or three days, given the fact that some ECC members thought the support price practice was inflationary in nature.

The ECC was informed that the public sector wheat stocks stood at 3.55 million tonnes on October 28, much lower than 5.85 million tonne stocks during the same period last year. The government had released about 1.27 million tonnes from its stocks since September 10. The ECC was informed that 992,000 tonnes of sugar was available on October 29, which was adequate for the current season. He said 21 sugar mills had fired up their boilers in Sindh so far and a mill in Punjab had started crushing the cane.

Dr Khan said the ECC reviewed a summary from the ministry of petroleum and natural resources on the IPI gas pipeline and agreed with the recommendations. He said he was not aware if the recommendations and the summary had been taken back from the participants. He said a steering committee would go through the draft gas sales and purchase agreement between Pakistan and Iran.

The ECC approved recommendations of the petroleum ministry to share profit arising out of domestic oil and condensate production between the government and the exploration companies as a result of record high international prices. The profit would be shared on 50:50 basis and the government would save $128 million between 2001 and 2007.

The meeting approved a summary seeking fixation of Rs85 million per acre for about 77 acres high-density and Rs24.5 million per acre for 71 acre land of the National Industrial Parks Development and Management Company (NIPDMC) for sale to private sector. He said about 148 acres would be sold for industrial purpose out of a total 240 acres while the remaining land would be used for road development.

The ECC also approved the sale of 35.37 acres of railways land at Port Qasim at the rate of Rs2 million per acre. The railways ministry informed the ECC that 110 acres of land had been allotted for the housing colony for the railway staff in 1997.

Dr Khan did not respond when asked if the Sindh government had been consulted on the sale and allocations of land in the province.

The ECC issued a notice to the proposed sponsors of 450-500MW Chichuki Malyan power project, including Alstom-Marubini and the government of Qatar to come up with a deadline within a week as to when they intended to file an application before the National Electric Power Regulatory Authority (Nepra) for tariff setting and by what date they would complete the project to avoid further delays.

Dr Khan said the ECC also extended for a third time the deadline for the setting up two power projects of 200-Megawatt each. He agreed the two projects of Bestway Group and Gulistan Group were earlier scheduled to be completed by 2008 but were now granted extension for completion by June 2011, but they were warned that they would not be allowed any more extension. The concessions already granted to them would remain in place.

The ECC approved a proposal seeking industry’s status to the trucking sector. Some additional fiscal incentives would be considered separately but the ECC did not agree to a proposal seeking a ban on 10- to 25-year-old trucks although it agreed to restrict trucks older than 10 years from coming on to the national highways and Motorways.

The ECC agreed to a proposals to provide Rs2.8 billion subsidy by the federal government to the KESC for not allowing 29 paisa per unit increase allowed by Nepra for April-June 2007 period.