ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet on Thursday raised the minimum support price of wheat from the previously announced Rs1,350 per 40kg to Rs1,365 per 40kg in view of reservations from various farmers and growers’ associations as well as the federal cabinet and the National Assembly’s Special Committee on Agricultural Products.
The ECC meeting, chaired by Adviser to Prime Minister on Finance and Revenue Dr Abdul Hafeez Shaikh, took this decision to “compensate and safeguard the interests of growers and ensure food security for the masses”.
Earlier, the Ministry of National Food Security & Research briefed the ECC on the feedback received from various farmers’ associations as well as different government forums and requested for fixing the minimum support price of wheat at Rs1,400 per 40kg. The committee deliberated on the proposal at length and in view of the discussion and input regarding the impact of any further increase in wheat price on food inflation and financial impact on the commodity stock operations, decided to raise the minimum support price of wheat to Rs1,365 per 40kg.
Meanwhile, the committee considered a proposal from the Ministry of Energy regarding tariff rationalisation for power sector in the first quarter of financial year 2019-20. The committee approved the proposal and notified the NEPRA-approved quarterly adjustment of 15 paisa per unit after incorporating additional charge of 11 paisa per unit to maintain uniform tariff on all categories of consumers except lifeline and domestic consumers.
The increase, which would come into effect on 1st December 2019 for the next 12 months, would not be applicable to nearly 20 million using up to 300 units per month, while 600,000 of the remaining one million consumers would only pay 7 paisa per unit as a result of this increase.
The ECC also constituted a committee, to be headed by Adviser to PM on Finance Dr Abdul Hafeez Shaikh, to examine the current framework of determining power tariff so that it could be made simpler in line with the practice in mature markets.
Moreover, the ECC considered a set of proposals from the Ministry of Energy for risk mitigation after the privatisation of National Power Parks Management Company, especially the impact on fuel basket price due to non or reduced offtake of 66pc generation under the PPA till year 2024 and cost of diversion of Regasified Liquefied Natural Gas (RLNG) to other sectors with workable options to mitigate the risk. The ECC approved the proposals with a proviso that any other option that could be considered as part of the mitigation plan by the Power Division could also be taken into account and approved, if found suitable, by the ECC.
The committee also considered a proposal by the Ministry of Communications that all cash development loans and foreign loans, whether direct or relent, including interest accumulated thereon, received up to June 30, 2019, by the National Highway Authority be converted into government grant or the government may either “write-off” the said loans. As per the proposal, for future, all PSDP allocations including relent/direct loans, both rupee and foreign exchange component i.e. for non-commercially viable projects and for strategic/defence roads to NHA, may also be provided a government grant.
The ECC discussed the proposals and in view of input from the members constituted a committee, to be headed by Planning Minister Asad Umar, to examine the proposals and submit its recommendations to the ECC.
Moreover, the ECC took up a proposal from the Ministry of Industries and Production for a technical supplementary grant of Rs6 billion to the Utility Stores Corporation (USC) for subsidy and procurement of essential commodities. The ECC discussed the issue in detail and in view of input from the members, asked the USC to prepare within the next few days a practical and comprehensive mechanism involving use of information technology to ensure the disbursement of specific food items to the poorest of the poor.
The ECC also constituted a committee to advise and help the USC in this regard.