Govt plans industrial policy reforms to remove power cross-subsidy, protect investors

The government plans to remove cross-subsidy from industrial power tariffs and abolish peak rates under the upcoming industrial policy to support exports, The News reported, citing official sources.

The policy also proposes a unified insolvency law and amendments to the SECP Act 1947 to protect industrialists from direct interference by the National Accountability Bureau (NAB), Federal Investigation Agency (FIA), and Federal Board of Revenue (FBR). 

Under the proposed changes to Sections 41B and 42A, no federal or provincial agency can initiate proceedings against regulated entities without SECP approval. This protection extends to stock exchanges, central depositories, clearing houses, conventional and digital NBFCs, insurance companies, brokers, and foreign investors, including NICOP holders.

According to the news report, the draft industrial policy also outlines measures to support exporters, including the announcement of the drawback of local taxes and levies (DLTL) scheme and timely clearance of stuck tax refunds, covering sales tax, customs rebates, income tax, and provincial levies. Industrial gas prices will also see the removal of cross-subsidy, and FBR audits of exporters will be limited to once every three years.

Additionally, the policy includes amendments to the Corporate Rehabilitation Act, 2018, and the Corporate Restructuring Companies Act, 2016, broadening the scope of eligible debtors, protecting companies, and facilitating restructuring.

Officials said the reforms aim to streamline regulatory procedures, ensure legal certainty, and enhance investor confidence in the industrial sector.