Pakistan will not seek relief on commercial loans’ repayment, ECC told

–Finance adviser says Pakistan ‘has the means and will to honour its commercial commitments’

Committee approves Rs360m for maintenance of Supreme Court buildings; Rs3.8bn to execute development schemes in Sindh

ISLAMABAD: Adviser to Prime Minister on Finance and Revenue Dr Abdul Hafeez Shaikh stated unequivocally on Wednesday that Pakistan had no intention of seeking any kind of relief on the repayment of its commercial loans or borrowings.

“Pakistan has the means and will to honour its commercial commitments,” the adviser said while chairing the meeting of the Economic Coordination Committee (ECC).

The committee gave in-principle approval to allow the Economic Affairs Division (EAD) to sign Memorandum of Understanding (MOU) to avail the G-20 relief initiative. However, this would be subject to the cabinet’s approval.

Pakistan is required to enter this MoU with all official bilateral creditors, including Paris Club creditors, to implement the debt relief initiative of G-20.

Meanwhile, the ECC approved various technical supplementary during the meeting, including Rs360.515 million for the repair and maintenance of Supreme Court of Pakistan buildings in Islamabad and various cities; Rs3.836 billion in favour of the Ministry of Housing and Works to execute development schemes in Sindh, and Rs291 million for the payment of salary of the Pakistan Public Works Department’s maintenance staff.

On the recommendations of the committee formed under the chairmanship of Adviser to PM on Institutional Reforms and Austerity Dr Ishrat Hussain to look into the issues of servicing of power sector loans and stock handling in a holistic manner, the ECC allowed allocation of Rs10 billion from the government’s ‘stimulus package’, as a stopgap arrangement, for the payment of interest on the Pakistan Energy Sukuk-II for a period of six months.

The committee also approved the proposal of the Revenue Division for declaration of the multi-model transit hub, Jia Bagga NLC Transit Port, as Customs clearance port under Section 9 of the Customs Act 1969.

In order to reduce the capacity charges of power generation companies through synthetic financing, the ECC approved the ToRs for negotiations with IPPs/Gencos as recommended by a committee constituted by the Cabinet Committee on Energy vide its decision dated April 2nd, 2020, under the chairmanship of the power minister.

The committee will submit its report in due course.

In order to manage and operate the Prime Minister’s COVID-19 Pandemic Relief Fund 2020, the ECC approved the constitution of a Policy Committee under the chairmanship of the prime minister.

The eight-member committee would comprise planning minister, PM’s finance adviser, commerce adviser, special assistant to PM on poverty alleviation and PM’s focal person on Corona Philanthropy Drive.

Terms of reference for the proposed committee would be i) to decide on the appropriate usage of the proceeds deposited in the fund including means of identification of the beneficiaries of the fund and the parameters of their selection; 2) to decide about the means of disbursement of assistance to the beneficiaries; and 3)  to take any appropriate decisions for collection of donations, maintenance and administration of the fund and related matters.

In order to devise a comprehensive policy to incentivise “Smartphone manufacturing in Pakistan”, the ECC constituted a committee under the chairmanship of Industries and Production minister, with members from the ministries of IT and industries, Board of Investment and Engineering Development Board.

The committee would bring its proposals after consultation with all the relevant stakeholders in due course.

The ECC also assigned the role of chairman to Hammad Azhar, being the Federal Minister for Industries and production, of a committee to oversee the effective utilization of subsidies, Ramzan relief package and PM’s Rs50 billion package for Utility Stores Corporation.

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